x
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Canada
|
|
98-0355078
|
(State or Other Jurisdiction
of Incorporation or Organization)
|
|
(IRS Employer
Identification No.)
|
|
|
|
7550 Ogden Dale Road S.E.,
Calgary, Alberta, Canada
|
|
T2C 4X9
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
|
Title of Each Class
|
|
|
|
Name of Each Exchange on which Registered
|
|
Common Shares, without par value
|
|
New York Stock Exchange
|
Large accelerated filer
þ
|
|
Accelerated filer
o
|
|
Non-accelerated filer
o
|
|
Smaller reporting company
o
|
|
PART I
|
|
|
|
Page
|
Item 1.
|
Business
|
|
Item 1A.
|
Risk Factors
|
|
Item 1B.
|
Unresolved Staff Comments
|
|
Item 2.
|
Properties
|
|
Item 3.
|
Legal Proceedings
|
|
Item 4.
|
Mine Safety Disclosures
|
|
|
Executive Officers of the Registrant
|
|
|
|
|
|
PART II
|
|
Item 5.
|
Market for Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of
|
|
|
Equity Securities
|
|
Item 6.
|
Selected Financial Data
|
|
Item 7.
|
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
|
Item 7A.
|
Quantitative and Qualitative Disclosures about Market Risk
|
|
Item 8.
|
Financial Statements and Supplementary Data
|
|
Item 9.
|
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
|
|
Item 9A.
|
Controls and Procedures
|
|
Item 9B.
|
Other Information
|
|
|
|
|
|
PART III
|
|
Item 10.
|
Directors, Executive Officers and Corporate Governance
|
|
Item 11.
|
Executive Compensation
|
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related
|
|
|
Shareholder Matters
|
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence
|
|
Item 14.
|
Principal Accounting Fees and Services
|
|
|
|
|
|
PART IV
|
|
Item 15.
|
Exhibits, Financial Statement Schedule
|
|
|
Signatures
|
•
|
protecting the environment;
|
•
|
ensuring compliance with applicable environmental laws and regulations;
|
•
|
promoting awareness and training;
|
•
|
managing emergencies through preparedness; and
|
•
|
encouraging involvement, consultation and dialogue with communities along the Company’s lines.
|
•
|
CP employs its own police service that works closely with communities and other law enforcement and government agencies to promote railway safety and infrastructure security. As a railway law enforcement agency, CP Police Services are headquartered in Calgary, Alberta, with police officers assigned to over 25 field offices responsible for railway police operations in six Canadian provinces and 14 U.S. states. CP Police Services operate on the CP rail network as well as in areas where CP has non-railway operations.
|
•
|
CP’s Police Communication Centre (“PCC”) operates 24 hours a day. The PCC receives reports of emergencies, dangerous or potentially dangerous conditions, and other safety and security issues from our employees, the public, and law enforcement and other government officials, and ensures that proper emergency responders are notified as well as governing bodies.
|
•
|
CP’s Security Management Plan is a comprehensive, risk-based plan modelled on and developed in conjunction with the security plan prepared by the Association of American Railroads post-September 11, 2001. Under this plan, CP routinely examines and prioritizes railroad assets, physical and cyber vulnerabilities, and threats, as well as tests and revises measures to provide essential railroad security. To address cyber security risks, CP implements mitigation programs that evolve with the changing technology threat environment. The Company has also worked diligently to establish backup sites to ensure a seamless transition in the event that the Company's operating systems are the target of a cyber-attack. By doing so, CP is able maintain network fluidity.
|
•
|
CP security efforts consist of a wide variety of measures including employee training, engagement with our customers and training of emergency responders.
|
|
Total
|
|
First main track
|
12,423
|
|
Second and other main track
|
1,199
|
|
Passing sidings and yard track
|
4,289
|
|
Industrial and way track
|
792
|
|
Total track miles
|
18,703
|
|
Locomotives
|
Owned
|
|
Leased
|
|
Total
|
|
Average Age
(in years)
|
|
Road freight
|
|
|
|
|
||||
High-adhesion alternating current
|
784
|
|
43
|
|
827
|
|
13
|
|
Standard direct current
|
297
|
|
—
|
|
297
|
|
30
|
|
Road switcher
|
344
|
|
—
|
|
344
|
|
23
|
|
Yard switcher
|
22
|
|
—
|
|
22
|
|
36
|
|
Total locomotives
|
1,447
|
|
43
|
|
1,490
|
|
19
|
|
Freight cars
|
Owned
|
Leased
|
|
Total
|
Average Age
(in years)
|
|
Box car
|
2,402
|
542
|
|
2,944
|
32
|
|
Covered hopper
|
6,071
|
13,081
|
|
19,152
|
28
|
|
Flat car
|
1,556
|
693
|
|
2,249
|
24
|
|
Gondola
|
3,421
|
1,862
|
|
5,283
|
21
|
|
Intermodal
|
1,331
|
—
|
|
1,331
|
14
|
|
Multi-level autorack
|
2,879
|
641
|
|
3,520
|
29
|
|
Company service car
|
2,200
|
172
|
|
2,372
|
46
|
|
Open top hopper
|
344
|
32
|
|
376
|
31
|
|
Tank car
|
11
|
191
|
|
202
|
13
|
|
Total freight cars
|
20,215
|
17,214
|
|
37,429
|
28
|
|
Name, Age and Position
|
Business Experience
|
Keith Creel, 48
President and Chief Executive Officer
|
Mr. Creel became President and CEO of CP on January 31, 2017. Previously he was President and Chief Operating Officer ("COO") from February 5, 2013 to January 30, 2017.
Prior to joining CP, Mr. Creel was Executive Vice-President and COO at CN from January 2010 to February 2013. During his time at CN, Mr. Creel held various positions including Executive Vice-President, Operations, Senior Vice-President Eastern Region, Senior Vice-President Western Region, and Vice-President of the Prairie Division.
Mr. Creel began his railroad career at Burlington Northern Railway in 1992 as an intermodal ramp manager in Birmingham, Alabama. He also spent part of his career at Grand Trunk Western Railroad as a superintendent and general manager, and at Illinois Central Railroad as a trainmaster and director of corridor operations, prior to its merger with CN in 1999.
|
Robert A. Johnson, 55
Executive Vice-President, Operations
|
Mr. Johnson has been Executive Vice-President, Operations of CP since April 20, 2016. Previous to this appointment, Mr. Johnson was CP's Senior Vice-President Operations, Southern Region from June 2013 to April 2016.
Prior to joining CP, Mr. Johnson's railroad career spanned 32 years with BNSF, where he held roles that progressively added to his responsibilities in operations, transportation, and service excellence. His most recent position at BNSF was General Manager, Northwest Division, overseeing day-to-day operations for that region.
|
Nadeem Velani, 44
Vice-President and Chief Financial Officer
|
Mr. Velani has been Vice-President and CFO of CP since October 19, 2016 and was the Vice-President, Investor Relations from October 28, 2015 and Assistant Vice-President, Investor Relations from March 11, 2013.
Prior to joining CP, Mr. Velani spent 15 years at CN where he worked in a variety of positions in Strategic and Financial Planning, Investor Relations, Sales and Marketing, and the Office of the President and CEO.
Mr. Velani holds an undergraduate degree in Economics from Western University and an MBA in Finance/International Business from McGill University.
|
John Brooks, 46
Senior Vice-President and Chief Marketing Officer
|
Mr. Brooks has been CP’s Vice-President and CMO since February 14, 2017. He has worked in senior marketing roles at CP since he joined the company in 2007, most recently as Vice-President, Marketing - Bulk and Intermodal.
Mr. Brooks began his railroading career with UP and later helped start I&M Rail Link, LLC, which was purchased by DM&E in 2002. Mr. Brooks was Vice-President, Marketing at DM&E prior to it being acquired by CP in 2007.
With more than 20 years in the railroading business, Mr. Brooks brings a breadth of experience to the CMO role that will be pivotal to CP's continued and future success.
|
James Clements, 47
Vice-President, Strategic Planning and Transportation Services
|
Mr. Clements has been CP's Vice-President, Strategic Planning and Transportation Services since 2015. Mr. Clements has responsibilities that include strategic network issues, joint facilities agreements, Network Service Centre operations, revenue planning and commercial policy. In addition, he has responsibility for CP Logistics and Transload Services.
Mr. Clements has been at CP for 22 years and his previous experience covers a wide range areas of CP’s business including car management, finance, logistics, grain marketing and sales in both Canada and the U.S., as well as Marketing and Sales responsibility for various lines of business at CP.
He has an MBA in International business and finance from McGill University and a B.Sc in Computer Science and Mathematics from McMaster University.
|
|
|
Q1
|
Q2
|
Q3
|
Q4
|
YTD
|
2016
|
Dividends
|
$0.3500
|
$0.5000
|
$0.5000
|
$0.5000
|
$1.8500
|
|
Common Share Price
|
|
|
|
|
|
|
High
|
$178.83
|
$193.88
|
$203.29
|
$209.12
|
$209.12
|
|
Low
|
$140.02
|
$156.01
|
$165.65
|
$186.21
|
$140.02
|
|
|
|
|
|
|
|
2015
|
Dividends
|
$0.3500
|
$0.3500
|
$0.3500
|
$0.3500
|
$1.4000
|
|
Common Share Price
|
|
|
|
|
|
|
High
|
$245.05
|
$241.73
|
$212.06
|
$204.40
|
$245.05
|
|
Low
|
$205.95
|
$195.69
|
$172.01
|
$168.12
|
$168.12
|
|
|
Q1
|
Q2
|
Q3
|
Q4
|
YTD
|
2016
|
Dividends
|
$0.2670
|
$0.3900
|
$0.3790
|
$0.3680
|
$1.4040
|
|
Common Share Price
|
|
|
|
|
|
|
High
|
$135.77
|
$151.38
|
$157.34
|
$156.71
|
$157.34
|
|
Low
|
$97.09
|
$119.50
|
$127.02
|
$139.29
|
$97.09
|
|
|
|
|
|
|
|
2015
|
Dividends
|
$0.2800
|
$0.2840
|
$0.2640
|
$0.2520
|
$1.0800
|
|
Common Share Price
|
|
|
|
|
|
|
High
|
$194.66
|
$198.44
|
$163.39
|
$157.82
|
$198.44
|
|
Low
|
$173.69
|
$158.04
|
$129.83
|
$122.27
|
$122.27
|
(in millions, except per share data, percentage and ratios)
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
|||||
Financial Performance
|
|
|
|
|
|
||||||||||
Revenues
|
$
|
6,232
|
|
$
|
6,712
|
|
$
|
6,620
|
|
$
|
6,133
|
|
$
|
5,695
|
|
Operating income
|
2,578
|
|
2,688
|
|
2,339
|
|
1,420
|
|
949
|
|
|||||
Adjusted operating income
(1)
|
2,578
|
|
2,620
|
|
2,335
|
|
1,844
|
|
1,309
|
|
|||||
Net income
|
1,599
|
|
1,352
|
|
1,476
|
|
875
|
|
484
|
|
|||||
Adjusted income
(1)
|
1,549
|
|
1,625
|
|
1,482
|
|
1,132
|
|
753
|
|
|||||
Basic earnings per share ("EPS")
|
10.69
|
|
8.47
|
|
8.54
|
|
5.00
|
|
2.82
|
|
|||||
Diluted EPS
|
10.63
|
|
8.40
|
|
8.46
|
|
4.96
|
|
2.79
|
|
|||||
Adjusted diluted EPS
(1)
|
10.29
|
|
10.10
|
|
8.50
|
|
6.42
|
|
4.34
|
|
|||||
Dividends declared per share
|
1.8500
|
|
1.4000
|
|
1.4000
|
|
1.4000
|
|
1.3500
|
|
|||||
Financial Position
|
|
|
|
|
|
||||||||||
Total assets
|
$
|
19,221
|
|
$
|
19,637
|
|
$
|
16,550
|
|
$
|
16,680
|
|
$
|
14,433
|
|
Total long-term obligations
(2)
|
8,737
|
|
9,012
|
|
5,712
|
|
4,747
|
|
4,696
|
|
|||||
Shareholders’ equity
|
4,626
|
|
4,796
|
|
5,610
|
|
7,097
|
|
5,097
|
|
|||||
Cash provided by operating activities
|
2,089
|
|
2,459
|
|
2,123
|
|
1,950
|
|
1,328
|
|
|||||
Free cash
(1)
|
1,007
|
|
1,381
|
|
969
|
|
774
|
|
316
|
|
|||||
Financial Ratios
|
|
|
|
|
|
||||||||||
Return on invested capital (“ROIC”)
(1)
|
14.4
|
%
|
12.9
|
%
|
14.4
|
%
|
10.1
|
%
|
7.3
|
%
|
|||||
Adjusted ROIC
(1)
|
14.0
|
%
|
15.2
|
%
|
14.5
|
%
|
12.3
|
%
|
10.0
|
%
|
|||||
Operating ratio
(3)
|
58.6
|
%
|
60.0
|
%
|
64.7
|
%
|
76.8
|
%
|
83.3
|
%
|
|||||
Adjusted operating ratio
(1)
|
58.6
|
%
|
61.0
|
%
|
64.7
|
%
|
69.9
|
%
|
77.0
|
%
|
(1)
|
These measures have no standardized meanings prescribed by accounting principles generally accepted in the United States of America ("GAAP") and, therefore may not be comparable to similar measures presented by other companies. These measures are defined and reconciled in Non-GAAP Measures in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
(2)
|
Excludes deferred income taxes of $
3,571 million
, $
3,391 million
, $2,717 million, $2,559 million and $1,838 million, and other non-financial deferred liabilities of $
940 million
, $
991 million
, $
1,100 million
, $
898 million
and $
1,574 million
at
December 31, 2016
,
2015
,
2014
,
2013
and
2012
respectively.
|
(3)
|
Operating ratio is defined as operating expenses divided by revenues.
|
|
Page
|
Executive Summary
|
|
2017 Outlook
|
|
Performance Indicators
|
|
Results of Operations
|
|
Impact of Foreign Exchange on Earnings
|
|
Impact of Fuel Price on Earnings
|
|
Impact of Share Price on Earnings
|
|
Operating Revenues
|
|
Operating Expenses
|
|
Other Income Statement Items
|
|
Liquidity and Capital Resources
|
|
Non-GAAP Measures
|
|
Off-Balance Sheet Arrangements
|
|
Critical Accounting Estimates
|
|
Forward-Looking Information
|
•
|
Financial performance –
In
2016
, CP reported Diluted EPS of
$10.63
while Adjusted diluted EPS climbed to a record
$10.29
, a 2% improvement compared to the Adjusted diluted EPS of
$10.10
in
2015
. CP’s commitment to operational efficiency produced a best-ever full-year operating ratio of
58.6%
, beating the previous record set in 2015, despite a 7% decrease in revenue associated with challenging economic conditions. Adjusted diluted EPS is defined and reconciled in Non-GAAP Measures and discussed further in Results of Operations of this Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
•
|
Free cash –
In
2016
, CP generated Free cash of
$1.0 billion
, a decrease of 27% over the prior year. The decrease was primarily driven by lower cash from operations and proceeds from the sale of D&H South in 2015, partially offset by lower capital expenditures. Free cash is defined and reconciled in Non-GAAP Measures and discussed further in Liquidity and Capital Resources of this Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
•
|
Operating performance
– CP’s continued focus on asset utilization and productivity gains resulted in significant improvements to CP’s key operating metrics. In
2016
, CP’s network train speed increased by
10%
to
23.5
miles per hour, terminal dwell improved by
7%
to
6.7
hours, and fuel efficiency improved by
2%
to
0.980
U.S. gallons of locomotive fuel consumed per 1,000 gross ton-miles ("GTMs"). These metrics are discussed further in Performance Indicators of this Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.
|
•
|
Safety
– The Company does not compromise safety for the sake of productivity gains. This relentless commitment to safety is demonstrated by CP’s safety statistics filed with the FRA. For 2016, CP’s FRA personal injuries frequency improved
11%
and FRA train accidents per million train-miles frequency improved
27%
, a new record for the Company.
|
|
|
|
|
% Change
|
||||||
For the year ended December 31
|
2016
|
|
2015
(1)
|
|
2014
(1)
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||
Operations Performance
|
|
|
|
|
|
|||||
Gross ton-miles (“GTMs”) (millions)
|
242,694
|
|
263,344
|
|
272,862
|
|
(8
|
)
|
(3
|
)
|
Train miles (thousands)
|
30,373
|
|
34,064
|
|
36,252
|
|
(11
|
)
|
(6
|
)
|
Average train weight – excluding local traffic (tons)
|
8,614
|
|
8,314
|
|
8,076
|
|
4
|
|
3
|
|
Average train length – excluding local traffic (feet)
|
7,217
|
|
6,935
|
|
6,682
|
|
4
|
|
4
|
|
Average terminal dwell (hours)
|
6.7
|
|
7.2
|
|
8.7
|
|
(7
|
)
|
(17
|
)
|
Average train speed (miles per hour, or "mph")
|
23.5
|
|
21.4
|
|
18.0
|
|
10
|
|
19
|
|
Fuel efficiency (U.S. gallons of locomotive fuel consumed /1,000 GTMs)
|
0.980
|
|
0.999
|
|
1.035
|
|
(2
|
)
|
(3
|
)
|
Total employees (average)
|
12,082
|
|
13,858
|
|
14,604
|
|
(13
|
)
|
(5
|
)
|
Total employees (end of period)
|
11,653
|
|
12,817
|
|
14,255
|
|
(9
|
)
|
(10
|
)
|
Workforce (end of period)
|
11,698
|
|
12,899
|
|
14,385
|
|
(9
|
)
|
(10
|
)
|
Safety Indicators
|
|
|
|
|
|
|||||
FRA personal injuries per 200,000 employee-hours
|
1.64
|
|
1.84
|
|
1.67
|
|
(11
|
)
|
10
|
|
FRA train accidents per million train-miles
|
0.97
|
|
1.33
|
|
1.26
|
|
(27
|
)
|
6
|
|
•
|
lower traffic volumes;
|
•
|
the unfavourable impacts of fluctuations in fuel price;
|
•
|
a $68 million gain on sale of D&H South in 2015;
|
•
|
higher depreciation and amortization; and
|
•
|
higher wage and benefit inflation.
|
•
|
efficiencies generated from improved operating performance and asset utilization;
|
•
|
a change of
$122
million in defined benefit pension plan from an expense of $32 million in 2015 to $90 million in income in 2016;
|
•
|
the favourable impact of the change in foreign exchange (“FX”) of $69 million; and
|
•
|
higher land sales.
|
•
|
the favourable impact of the change in FX of $247 million;
|
•
|
efficiencies generated from improved operating performance and asset utilization;
|
•
|
the gain on sale of D&H South of $68 million;
|
•
|
lower share-based compensation primarily driven by the change in share price and lower incentive-based compensation;
|
•
|
lower fuel price; and
|
•
|
higher land sales.
|
•
|
lower traffic volume;
|
•
|
a change of $84 million in defined benefit pension plan from $52 million in income in 2014 to an expense of $32 million in 2015;
|
•
|
higher wage and benefit inflation; and
|
•
|
higher casualty expenses as a result of more costly incidents.
|
•
|
efficiencies generated from improved operating performance and asset utilization;
|
•
|
a change of
$122
million in defined benefit pension plan from an expense of $32 million in 2015 to $90 million in income in 2016;
|
•
|
higher land sales of
$32 million
; and
|
•
|
the favourable impact of the change in FX of $69 million.
|
•
|
lower traffic volumes;
|
•
|
a $68 million gain on disposition of D&H South in 2015;
|
•
|
higher depreciation and amortization; and
|
•
|
higher wage and benefit inflation.
|
•
|
the favourable impact of the change in FX of $247 million;
|
•
|
efficiencies generated from improved operating performance and asset utilization;
|
•
|
the gain on sale of D&H South;
|
•
|
lower share-based compensation primarily driven by the change in share price and lower incentive-based compensation;
|
•
|
lower fuel price; and
|
•
|
higher land sales.
|
•
|
lower traffic volume;
|
•
|
a change of $84 million in defined benefit pension plan from $52 million in income in 2014 to an expense of $32 million in 2015;
|
•
|
higher wage and benefit inflation; and
|
•
|
higher casualty expenses as a result of more costly incidents.
|
Average exchange rates (Canadian to U.S. dollar)
|
2016
|
|
2015
|
|
2014
|
|
|||
For the year ended – December 31
|
$
|
1.33
|
|
$
|
1.28
|
|
$
|
1.10
|
|
For the three months ended – December 31
|
$
|
1.33
|
|
$
|
1.34
|
|
$
|
1.13
|
|
Exchange rates (Canadian to U.S. dollar)
|
2016
|
|
2015
|
|
2014
|
|
|||
Beginning of year – January 1
|
$
|
1.38
|
|
$
|
1.16
|
|
$
|
1.06
|
|
Beginning of quarter – April 1
|
$
|
1.30
|
|
$
|
1.27
|
|
$
|
1.11
|
|
Beginning of quarter – July 1
|
$
|
1.29
|
|
$
|
1.25
|
|
$
|
1.07
|
|
Beginning of quarter – October 1
|
$
|
1.31
|
|
$
|
1.33
|
|
$
|
1.12
|
|
End of quarter – December 31
|
$
|
1.34
|
|
$
|
1.38
|
|
$
|
1.16
|
|
Average Fuel Price (U.S. dollars per U.S. gallon)
|
2016
|
|
2015
|
|
2014
|
|
|||
For the year ended – December 31
|
$
|
1.80
|
|
$
|
2.13
|
|
$
|
3.41
|
|
For the three months ended – December 31
|
$
|
2.01
|
|
$
|
1.91
|
|
$
|
3.11
|
|
Toronto Stock Exchange (in Canadian dollars)
|
2016
|
|
2015
|
|
2014
|
|
|||
Opening Common Share price, as at January 1
|
$
|
176.73
|
|
$
|
223.75
|
|
$
|
160.65
|
|
Ending Common Share price, as at March 31
|
$
|
172.55
|
|
$
|
231.90
|
|
$
|
165.65
|
|
Ending Common Share price, as at June 30
|
$
|
166.33
|
|
$
|
200.02
|
|
$
|
193.31
|
|
Ending Common Share price, as at September 30
|
$
|
200.19
|
|
$
|
191.54
|
|
$
|
232.43
|
|
Ending Common Share price, as at December 31
|
$
|
191.56
|
|
$
|
176.73
|
|
$
|
223.75
|
|
Change in Common Share price for the year ended December 31
|
$
|
14.83
|
|
$
|
(47.02
|
)
|
$
|
63.10
|
|
New York Stock Exchange (in U.S. dollars)
|
2016
|
|
2015
|
|
2014
|
|
|||
Opening Common Share price, as at January 1
|
$
|
127.60
|
|
$
|
192.69
|
|
$
|
151.32
|
|
Ending Common Share price, as at March 31
|
$
|
132.69
|
|
$
|
182.70
|
|
$
|
150.43
|
|
Ending Common Share price, as at June 30
|
$
|
128.79
|
|
$
|
160.23
|
|
$
|
181.14
|
|
Ending Common Share price, as at September 30
|
$
|
152.70
|
|
$
|
143.57
|
|
$
|
207.47
|
|
Ending Common Share price, as at December 31
|
$
|
142.77
|
|
$
|
127.60
|
|
$
|
192.69
|
|
Change in Common Share price for the year ended December 31
|
$
|
15.17
|
|
$
|
(65.09
|
)
|
$
|
41.37
|
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||||||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change (2) |
Total Change
|
% Change
|
FX Adjusted
% Change (2) |
||||||||||||||
Freight revenues (in millions)
(1)
|
$
|
6,060
|
|
$
|
6,552
|
|
$
|
6,464
|
|
$
|
(492
|
)
|
(8
|
)
|
(10
|
)
|
$
|
88
|
|
1
|
|
(7
|
)
|
Non-freight revenues (in millions)
|
172
|
|
160
|
|
156
|
|
12
|
|
8
|
|
7
|
|
4
|
|
3
|
|
—
|
|
|||||
Total revenues (in millions)
|
$
|
6,232
|
|
$
|
6,712
|
|
$
|
6,620
|
|
$
|
(480
|
)
|
(7
|
)
|
(9
|
)
|
$
|
92
|
|
1
|
|
(6
|
)
|
Carloads (in thousands)
|
2,525
|
|
2,628
|
|
2,684
|
|
(103
|
)
|
(4
|
)
|
N/A
|
|
(56
|
)
|
(2
|
)
|
N/A
|
|
|||||
Revenue ton-miles (in millions)
|
135,952
|
|
145,257
|
|
149,849
|
|
(9,305
|
)
|
(6
|
)
|
N/A
|
|
(4,592
|
)
|
(3
|
)
|
N/A
|
|
|||||
Freight revenue per carload (dollars)
|
$
|
2,400
|
|
$
|
2,493
|
|
$
|
2,408
|
|
$
|
(93
|
)
|
(4
|
)
|
N/A
|
|
$
|
85
|
|
4
|
|
N/A
|
|
Freight revenue per revenue ton-miles (cents)
|
4.46
|
|
4.51
|
|
4.31
|
|
(0.05
|
)
|
(1
|
)
|
N/A
|
|
0.20
|
|
5
|
|
N/A
|
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
|||||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change |
Total Change
|
% Change
|
FX Adjusted
% Change |
|||||||||||||
Freight revenues (in millions)
|
$
|
962
|
|
$
|
1,068
|
|
$
|
988
|
|
$
|
(106
|
)
|
(10
|
)
|
(11
|
)
|
$
|
80
|
|
8
|
|
4
|
Carloads (in thousands)
|
270
|
|
285
|
|
291
|
|
(15
|
)
|
(5
|
)
|
N/A
|
|
(6
|
)
|
(2
|
)
|
N/A
|
|||||
Revenue ton-miles (in millions)
|
25,994
|
|
27,442
|
|
26,691
|
|
(1,448
|
)
|
(5
|
)
|
N/A
|
|
751
|
|
3
|
|
N/A
|
|||||
Freight revenue per carload (dollars)
|
$
|
3,559
|
|
$
|
3,750
|
|
$
|
3,391
|
|
$
|
(191
|
)
|
(5
|
)
|
N/A
|
|
$
|
359
|
|
11
|
|
N/A
|
Freight revenue per revenue ton-mile (cents)
|
3.70
|
|
3.89
|
|
3.70
|
|
(0.19
|
)
|
(5
|
)
|
N/A
|
|
0.19
|
|
5
|
|
N/A
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||||||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change |
Total Change
|
% Change
|
FX Adjusted
% Change |
||||||||||||||
Freight revenues (in millions)
|
$
|
518
|
|
$
|
522
|
|
$
|
503
|
|
$
|
(4
|
)
|
(1
|
)
|
(5
|
)
|
$
|
19
|
|
4
|
|
(12
|
)
|
Carloads (in thousands)
|
162
|
|
157
|
|
173
|
|
5
|
|
3
|
|
N/A
|
|
(16
|
)
|
(9
|
)
|
N/A
|
|
|||||
Revenue ton-miles (in millions)
|
10,898
|
|
10,625
|
|
11,724
|
|
273
|
|
3
|
|
N/A
|
|
(1,099
|
)
|
(9
|
)
|
N/A
|
|
|||||
Freight revenue per carload (dollars)
|
$
|
3,202
|
|
$
|
3,326
|
|
$
|
2,909
|
|
$
|
(124
|
)
|
(4
|
)
|
N/A
|
|
$
|
417
|
|
14
|
|
N/A
|
|
Freight revenue per revenue ton-mile (cents)
|
4.75
|
|
4.91
|
|
4.29
|
|
(0.16
|
)
|
(3
|
)
|
N/A
|
|
0.62
|
|
14
|
|
N/A
|
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
|||||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change |
Total Change
|
% Change
|
FX Adjusted
% Change |
|||||||||||||
Freight revenues (in millions)
|
$
|
606
|
|
$
|
639
|
|
$
|
621
|
|
$
|
(33
|
)
|
(5
|
)
|
(6
|
)
|
$
|
18
|
|
3
|
|
1
|
Carloads (in thousands)
|
305
|
|
323
|
|
313
|
|
(18
|
)
|
(6
|
)
|
N/A
|
|
10
|
|
3
|
|
N/A
|
|||||
Revenue ton-miles (in millions)
|
22,171
|
|
22,164
|
|
22,443
|
|
7
|
|
—
|
|
N/A
|
|
(279
|
)
|
(1
|
)
|
N/A
|
|||||
Freight revenue per carload (dollars)
|
$
|
1,984
|
|
$
|
1,978
|
|
$
|
1,985
|
|
$
|
6
|
|
—
|
|
N/A
|
|
$
|
(7
|
)
|
—
|
|
N/A
|
Freight revenue per revenue ton-mile (cents)
|
2.73
|
|
2.88
|
|
2.77
|
|
(0.15
|
)
|
(5
|
)
|
N/A
|
|
0.11
|
|
4
|
|
N/A
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||||||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change |
Total Change
|
% Change
|
FX Adjusted
% Change |
||||||||||||||
Freight revenues (in millions)
|
$
|
338
|
|
$
|
359
|
|
$
|
347
|
|
$
|
(21
|
)
|
(6
|
)
|
(8
|
)
|
$
|
12
|
|
3
|
|
(4
|
)
|
Carloads (in thousands)
|
116
|
|
124
|
|
118
|
|
(8
|
)
|
(6
|
)
|
N/A
|
|
6
|
|
5
|
|
N/A
|
|
|||||
Revenue ton-miles (in millions)
|
14,175
|
|
15,117
|
|
14,099
|
|
(942
|
)
|
(6
|
)
|
N/A
|
|
1,018
|
|
7
|
|
N/A
|
|
|||||
Freight revenue per carload (dollars)
|
$
|
2,904
|
|
$
|
2,887
|
|
$
|
2,941
|
|
$
|
17
|
|
1
|
|
N/A
|
|
$
|
(54
|
)
|
(2
|
)
|
N/A
|
|
Freight revenue per revenue ton-mile (cents)
|
2.38
|
|
2.37
|
|
2.46
|
|
0.01
|
|
—
|
|
N/A
|
|
(0.09
|
)
|
(4
|
)
|
N/A
|
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change |
Total Change
|
% Change
|
FX Adjusted
% Change |
||||||||||||
Freight revenues (in millions)
|
$
|
284
|
|
$
|
272
|
|
$
|
234
|
|
$
|
12
|
|
4
|
|
2
|
$
|
38
|
|
16
|
|
6
|
Carloads (in thousands)
|
60
|
|
62
|
|
61
|
|
(2
|
)
|
(3
|
)
|
N/A
|
1
|
|
2
|
|
N/A
|
|||||
Revenue ton-miles (in millions)
|
4,140
|
|
4,044
|
|
4,180
|
|
96
|
|
2
|
|
N/A
|
(136
|
)
|
(3
|
)
|
N/A
|
|||||
Freight revenue per carload (dollars)
|
$
|
4,769
|
|
$
|
4,410
|
|
$
|
3,801
|
|
$
|
359
|
|
8
|
|
N/A
|
$
|
609
|
|
16
|
|
N/A
|
Freight revenue per revenue ton-mile (cents)
|
6.87
|
|
6.71
|
|
5.59
|
|
0.16
|
|
2
|
|
N/A
|
1.12
|
|
20
|
|
N/A
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
|||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change |
Total Change
|
% Change
|
FX Adjusted
% Change |
|||||||||||
Freight revenues (in millions)
|
$
|
275
|
|
$
|
249
|
|
$
|
206
|
|
$
|
26
|
|
10
|
|
7
|
$
|
43
|
|
21
|
8
|
Carloads (in thousands)
|
66
|
|
62
|
|
59
|
|
4
|
|
6
|
|
N/A
|
3
|
|
5
|
N/A
|
|||||
Revenue ton-miles (in millions)
|
4,691
|
|
4,201
|
|
3,956
|
|
490
|
|
12
|
|
N/A
|
245
|
|
6
|
N/A
|
|||||
Freight revenue per carload (dollars)
|
$
|
4,157
|
|
$
|
4,026
|
|
$
|
3,493
|
|
$
|
131
|
|
3
|
|
N/A
|
$
|
533
|
|
15
|
N/A
|
Freight revenue per revenue ton-mile (cents)
|
5.86
|
|
5.92
|
|
5.20
|
|
(0.06
|
)
|
(1
|
)
|
N/A
|
0.72
|
|
14
|
N/A
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||||||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change |
Total Change
|
% Change
|
FX Adjusted
% Change |
||||||||||||||
Freight revenues (in millions)
|
$
|
714
|
|
$
|
709
|
|
$
|
637
|
|
$
|
5
|
|
1
|
|
(3
|
)
|
$
|
72
|
|
11
|
|
(2
|
)
|
Carloads (in thousands)
|
212
|
|
203
|
|
198
|
|
9
|
|
4
|
|
N/A
|
|
5
|
|
3
|
|
N/A
|
|
|||||
Revenue ton-miles (in millions)
|
14,294
|
|
13,611
|
|
13,635
|
|
683
|
|
5
|
|
N/A
|
|
(24
|
)
|
—
|
|
N/A
|
|
|||||
Freight revenue per carload (dollars)
|
$
|
3,368
|
|
$
|
3,483
|
|
$
|
3,214
|
|
$
|
(115
|
)
|
(3
|
)
|
N/A
|
|
$
|
269
|
|
8
|
|
N/A
|
|
Freight revenue per revenue ton-mile (cents)
|
4.99
|
|
5.21
|
|
4.67
|
|
(0.22
|
)
|
(4
|
)
|
N/A
|
|
0.54
|
|
12
|
|
N/A
|
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||||||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change |
Total Change
|
% Change
|
FX Adjusted
% Change |
||||||||||||||
Freight revenues (in millions)
|
$
|
138
|
|
$
|
393
|
|
$
|
484
|
|
$
|
(255
|
)
|
(65
|
)
|
(66
|
)
|
$
|
(91
|
)
|
(19
|
)
|
(29
|
)
|
Carloads (in thousands)
|
38
|
|
91
|
|
110
|
|
(53
|
)
|
(58
|
)
|
N/A
|
|
(19
|
)
|
(17
|
)
|
N/A
|
|
|||||
Revenue ton-miles (in millions)
|
4,727
|
|
13,280
|
|
16,312
|
|
(8,553
|
)
|
(64
|
)
|
N/A
|
|
(3,032
|
)
|
(19
|
)
|
N/A
|
|
|||||
Freight revenue per carload (dollars)
|
$
|
3,646
|
|
$
|
4,309
|
|
$
|
4,419
|
|
$
|
(663
|
)
|
(15
|
)
|
N/A
|
|
$
|
(110
|
)
|
(2
|
)
|
N/A
|
|
Freight revenue per revenue ton-mile (cents)
|
2.93
|
|
2.96
|
|
2.97
|
|
(0.03
|
)
|
(1
|
)
|
N/A
|
|
(0.01
|
)
|
—
|
|
N/A
|
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||||||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change |
Total Change
|
% Change
|
FX Adjusted
% Change |
||||||||||||||
Freight revenues (in millions)
|
$
|
564
|
|
$
|
643
|
|
$
|
712
|
|
$
|
(79
|
)
|
(12
|
)
|
(15
|
)
|
$
|
(69
|
)
|
(10
|
)
|
(20
|
)
|
Carloads (in thousands)
|
196
|
|
217
|
|
253
|
|
(21
|
)
|
(10
|
)
|
N/A
|
|
(36
|
)
|
(14
|
)
|
N/A
|
|
|||||
Revenue ton-miles (in millions)
|
8,338
|
|
9,020
|
|
11,266
|
|
(682
|
)
|
(8
|
)
|
N/A
|
|
(2,246
|
)
|
(20
|
)
|
N/A
|
|
|||||
Freight revenue per carload (dollars)
|
$
|
2,888
|
|
$
|
2,963
|
|
$
|
2,814
|
|
$
|
(75
|
)
|
(3
|
)
|
N/A
|
|
$
|
149
|
|
5
|
|
N/A
|
|
Freight revenue per revenue ton-mile (cents)
|
6.77
|
|
7.13
|
|
6.32
|
|
(0.36
|
)
|
(5
|
)
|
N/A
|
|
0.81
|
|
13
|
|
N/A
|
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||||||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change |
Total Change
|
% Change
|
FX Adjusted
% Change |
||||||||||||||
Freight revenues (in millions)
|
$
|
350
|
|
$
|
349
|
|
$
|
357
|
|
$
|
1
|
|
—
|
|
(3
|
)
|
$
|
(8
|
)
|
(2
|
)
|
(11
|
)
|
Carloads (in thousands)
|
124
|
|
131
|
|
134
|
|
(7
|
)
|
(5
|
)
|
N/A
|
|
(3
|
)
|
(2
|
)
|
N/A
|
|
|||||
Revenue ton-miles (in millions)
|
1,667
|
|
1,750
|
|
1,953
|
|
(83
|
)
|
(5
|
)
|
N/A
|
|
(203
|
)
|
(10
|
)
|
N/A
|
|
|||||
Freight revenue per carload (dollars)
|
$
|
2,825
|
|
$
|
2,659
|
|
$
|
2,670
|
|
$
|
166
|
|
6
|
|
N/A
|
|
$
|
(11
|
)
|
—
|
|
N/A
|
|
Freight revenue per revenue ton-mile (cents)
|
21.02
|
|
19.97
|
|
18.26
|
|
1.05
|
|
5
|
|
N/A
|
|
1.71
|
|
9
|
|
N/A
|
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||||||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change |
Total Change
|
% Change
|
FX Adjusted
% Change |
||||||||||||||
Freight revenues (in millions)
|
$
|
721
|
|
$
|
757
|
|
$
|
787
|
|
$
|
(36
|
)
|
(5
|
)
|
(5
|
)
|
$
|
(30
|
)
|
(4
|
)
|
(6
|
)
|
Carloads (in thousands)
|
427
|
|
414
|
|
428
|
|
13
|
|
3
|
|
N/A
|
|
(14
|
)
|
(3
|
)
|
N/A
|
|
|||||
Revenue ton-miles (in millions)
|
11,992
|
|
12,072
|
|
11,867
|
|
(80
|
)
|
(1
|
)
|
N/A
|
|
205
|
|
2
|
|
N/A
|
|
|||||
Freight revenue per carload (dollars)
|
$
|
1,688
|
|
$
|
1,831
|
|
$
|
1,837
|
|
$
|
(143
|
)
|
(8
|
)
|
N/A
|
|
$
|
(6
|
)
|
—
|
|
N/A
|
|
Freight revenue per revenue ton-mile (cents)
|
6.01
|
|
6.27
|
|
6.63
|
|
(0.26
|
)
|
(4
|
)
|
N/A
|
|
(0.36
|
)
|
(5
|
)
|
N/A
|
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||||||||||||||||||
For the year ended December 31
|
2016
|
2015
|
2014
|
Total Change
|
% Change
|
FX Adjusted
% Change |
Total Change
|
% Change
|
FX Adjusted
% Change |
||||||||||||||
Freight revenues (in millions)
|
$
|
590
|
|
$
|
592
|
|
$
|
588
|
|
$
|
(2
|
)
|
—
|
|
(2
|
)
|
$
|
4
|
|
1
|
|
(5
|
)
|
Carloads (in thousands)
|
549
|
|
559
|
|
546
|
|
(10
|
)
|
(2
|
)
|
N/A
|
|
13
|
|
2
|
|
N/A
|
|
|||||
Revenue ton-miles (in millions)
|
12,865
|
|
11,931
|
|
11,723
|
|
934
|
|
8
|
|
N/A
|
|
208
|
|
2
|
|
N/A
|
|
|||||
Freight revenue per carload (dollars)
|
$
|
1,074
|
|
$
|
1,061
|
|
$
|
1,077
|
|
$
|
13
|
|
1
|
|
N/A
|
|
$
|
(16
|
)
|
(1
|
)
|
N/A
|
|
Freight revenue per revenue ton-mile (cents)
|
4.59
|
|
4.96
|
|
5.02
|
|
(0.37
|
)
|
(7
|
)
|
N/A
|
|
(0.06
|
)
|
(1
|
)
|
N/A
|
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||||||||||||||||||
For the year ended December 31 (in millions)
|
2016
|
|
2015
|
|
2014
|
|
Total Change
|
% Change
|
FX Adjusted % Change
(1)
|
Total Change
|
% Change
|
FX Adjusted % Change
(1)
|
|||||||||||
Compensation and benefits
|
$
|
1,189
|
|
$
|
1,371
|
|
$
|
1,348
|
|
$
|
(182
|
)
|
(13
|
)
|
(14
|
)
|
$
|
23
|
|
2
|
|
(3
|
)
|
Fuel
|
567
|
|
708
|
|
1,048
|
|
(141
|
)
|
(20
|
)
|
(23
|
)
|
(340
|
)
|
(32
|
)
|
(41
|
)
|
|||||
Materials
|
180
|
|
184
|
|
193
|
|
(4
|
)
|
(2
|
)
|
(3
|
)
|
(9
|
)
|
(5
|
)
|
(7
|
)
|
|||||
Equipment rents
|
173
|
|
174
|
|
155
|
|
(1
|
)
|
(1
|
)
|
(3
|
)
|
19
|
|
12
|
|
1
|
|
|||||
Depreciation and amortization
|
640
|
|
595
|
|
552
|
|
45
|
|
8
|
|
7
|
|
43
|
|
8
|
|
4
|
|
|||||
Purchased services and other
|
905
|
|
1,060
|
|
985
|
|
(155
|
)
|
(15
|
)
|
(16
|
)
|
75
|
|
8
|
|
1
|
|
|||||
Gain on sale of D&H South
|
—
|
|
(68
|
)
|
—
|
|
68
|
|
(100
|
)
|
(100
|
)
|
(68
|
)
|
100
|
|
100
|
|
|||||
Total operating expenses
|
$
|
3,654
|
|
$
|
4,024
|
|
$
|
4,281
|
|
$
|
(370
|
)
|
(9
|
)
|
(11
|
)
|
$
|
(257
|
)
|
(6
|
)
|
(12
|
)
|
•
|
efficiencies generated from improved operating performance and asset utilization;
|
•
|
lower volume variable expenses;
|
•
|
change of
$122
million in defined benefit pension plan from an expense of $32 million in 2015 to $90 million in income in 2016;
|
•
|
the favourable impact of
$100 million
from lower fuel prices; and
|
•
|
a $32 million increase in land sales.
|
•
|
the unfavourable impact of the change in FX of $77 million;
|
•
|
the gain on sale of D&H South of $68 million in 2015;
|
•
|
higher depreciation and amortization due to a higher asset base; and
|
•
|
the impact of wage and benefit inflation of approximately 3%.
|
•
|
the favourable impact of $403 million from lower fuel prices;
|
•
|
efficiencies generated from improved operating performance and asset utilization;
|
•
|
the favourable impact of $87 million from lower stock-based compensation primarily driven by the change in stock price and lower incentive-based compensation;
|
•
|
the $68 million favourable gain on sale of D&H South;
|
•
|
lower volume variable expenses; and
|
•
|
a $42 million increase in land sales.
|
•
|
the unfavourable impact of the change in FX of $306 million;
|
•
|
a change of $84 million in defined benefit pension plan from $52 million in income in 2014 to an expense of $32 million in 2015;
|
•
|
the impact of wage and benefit inflation of approximately 3%; and
|
•
|
higher casualty expenses as a result of more costly incidents of $37 million.
|
•
|
change of
$122
million in defined benefit pension plan from an expense of $32 million in 2015 to $90 million in income in 2016;
|
•
|
lower costs achieved through job reductions;
|
•
|
lower volume variable expenses as a result of a decrease in workload as measured by GTMs;
|
•
|
road and yard efficiencies as a result of continuing strong operational performance; and
|
•
|
the favourable impact of $20 million from lower stock-based compensation and incentive-based compensation.
|
•
|
a change of $84 million in defined benefit pension plan from $52 million in income in 2014 to an expense of $32 million in 2015;
|
•
|
the unfavourable impact of the change in FX of $62 million; and
|
•
|
the impact of wage and benefit inflation of approximately 3%.
|
•
|
the favourable impact of $87 million from lower stock-based compensation primarily driven by the change in stock price and lower incentive-based compensation;
|
•
|
lower costs achieved through job reductions;
|
•
|
road and yard efficiencies as a result of continuing strong operational performance; and
|
•
|
lower volume variable expenses as a result of a decrease in workload as measured by GTMs.
|
•
|
lower fuel prices with a favourable impact of
$100 million
;
|
•
|
a reduction in workload, as measured by GTMs; and
|
•
|
improvements in fuel efficiency of approximately 2% as a result of increased locomotive productivity, operational fluidity and the advancement of the Company’s fuel conservation strategies.
|
•
|
lower fuel prices with a favourable impact of $403 million;
|
•
|
a reduction in workload, as measured by GTMs; and
|
•
|
improvements in fuel efficiency of approximately 3% as a result of increased locomotive productivity, operational fluidity and the advancement of the Company’s fuel conservation strategies.
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
|||||||||||||
For the year ended December 31 (in millions)
|
2016
(1)
|
|
2015
|
|
2014
|
|
% Change
|
Total Change
|
% Change
|
Total Change
|
||||||||
Support and facilities
|
$
|
271
|
|
$
|
298
|
|
$
|
297
|
|
(9
|
)
|
$
|
(27
|
)
|
—
|
$
|
1
|
|
Track and operations
|
238
|
|
266
|
|
243
|
|
(11
|
)
|
(28
|
)
|
9
|
23
|
|
|||||
Intermodal
|
180
|
|
184
|
|
176
|
|
(2
|
)
|
(4
|
)
|
5
|
8
|
|
|||||
Equipment
|
165
|
|
196
|
|
166
|
|
(16
|
)
|
(31
|
)
|
18
|
30
|
|
|||||
Casualty
|
68
|
|
74
|
|
35
|
|
(8
|
)
|
(6
|
)
|
111
|
39
|
|
|||||
Property taxes
|
116
|
|
103
|
|
94
|
|
13
|
|
13
|
|
10
|
9
|
|
|||||
Other
|
(27
|
)
|
13
|
|
6
|
|
(308
|
)
|
(40
|
)
|
117
|
7
|
|
|||||
Land sales
|
(106
|
)
|
(74
|
)
|
(32
|
)
|
43
|
|
(32
|
)
|
131
|
(42
|
)
|
|||||
Total Purchased services and other
|
$
|
905
|
|
$
|
1,060
|
|
$
|
985
|
|
(15
|
)
|
$
|
(155
|
)
|
8
|
$
|
75
|
|
•
|
lower third party service costs, reported in Track and operations and Support and facilities;
|
•
|
a $17 million gain on sale of surplus freight cars, and a reduction in accrued discontinuance costs for certain branch lines, reported in Other;
|
•
|
higher land sales of $32 million resulting from optimization of the Company's assets, as discussed further below;
|
•
|
lower crew travel and accommodations costs, reported in Track and operations;
|
•
|
lower third-party freight car and locomotive maintenance costs, reported in Equipment; and
|
•
|
lower casualty expenses of $8 million (excluding FX) as a result of lower third party claims and incident related environmental costs due to effective incident response and case management. This is partially offset by higher personal injury costs.
|
•
|
the unfavourable impact of the change in FX of $60 million;
|
•
|
higher casualty expenses as a result of more costly incidents, reported in Casualty;
|
•
|
higher intermodal expenses related to pickup and delivery service, reported in Intermodal;
|
•
|
increased locomotive overhauls, reported in Equipment; and
|
•
|
higher legal fees and support costs, reported in Support and facilities.
|
•
|
in the fourth quarter of 2016, the Company completed the sale of CP's Obico rail yard for gross proceeds of $38 million and a gain on sale of $37 million;
|
•
|
in the second quarter of 2016, the Company disposed of 1,000 surplus freight cars that had reached or were nearing the end of their useful life, in a non-monetary exchange for new freight cars. The Company recognized a gain on sale of $17 million from the transaction and the sale did not impact cash from investing activities;
|
•
|
in the first quarter of 2016, the Company completed the sale of CP’s Arbutus Corridor to the City of Vancouver for gross proceeds of $55 million and a gain on sale of $50 million. The agreement allows the Company to share in future proceeds on the eventual development and/or sale of certain parcels of the Arbutus Corridor; and
|
•
|
in the first quarter of 2015, the Company recorded gains on land sales totalling $60 million, including a gain of $31 million following the sale of a building after resolution of legal proceedings, and various sections of land in eastern Canada for transit purposes.
|
For the year ended December 31
(in millions, except for track miles and crossties)
|
2016
|
|
2015
|
|
2014
|
|
|||
Additions to capital
|
|
|
|
||||||
Track and roadway
|
$
|
904
|
|
$
|
1,119
|
|
$
|
1,011
|
|
Rolling stock
|
105
|
|
158
|
|
219
|
|
|||
Information systems
(1)
|
88
|
|
79
|
|
96
|
|
|||
Buildings and other
|
108
|
|
180
|
|
150
|
|
|||
Total – accrued additions to capital
|
1,205
|
|
1,536
|
|
1,476
|
|
|||
Less:
|
|
|
|
||||||
Non-cash transactions
|
23
|
|
14
|
|
27
|
|
|||
Cash invested in additions to properties (per Consolidated Statements of Cash Flows)
|
$
|
1,182
|
|
$
|
1,522
|
|
$
|
1,449
|
|
Track installation capital programs
|
|
|
|
||||||
Track miles of rail laid (miles)
|
252
|
|
468
|
|
492
|
|
|||
Track miles of rail capacity expansion (miles)
|
2
|
|
22
|
|
21
|
|
|||
Crossties installed (thousands)
|
1,008
|
|
1,009
|
|
1,040
|
|
Long-term debt
|
|
Outlook
|
|
Standard & Poor's
|
|
|
|
|
Long-term corporate credit
|
BBB+
|
stable
|
|
Senior secured debt
|
A
|
stable
|
|
Senior unsecured debt
|
BBB+
|
stable
|
Moody's
|
|
|
|
|
Senior unsecured debt
|
Baa1
|
negative
|
DBRS
|
|
|
|
|
Unsecured debentures
|
BBB
|
stable
|
|
Medium-term notes
|
BBB
|
stable
|
|
|
|
|
$1 billion Commercial paper program
|
|
|
|
Standard & Poor's
|
A-2
|
N/A
|
|
Moody's
|
|
P-2
|
N/A
|
DBRS
|
|
R-2 (middle)
|
N/A
|
•
|
in the third quarter, a $25 million expense ($18 million after current tax) related to a legal settlement that unfavourably impacted Diluted EPS by 12 cents; and
|
•
|
during the course of the year, a net non-cash gain of $79 million ($68 million after deferred tax) due to FX translation of the Company’s U.S. dollar-denominated debt as follows:
|
•
|
in the fourth quarter, a $74 million loss ($64 million after deferred tax) that unfavourably impacted Diluted EPS by 43 cents;
|
•
|
in the third quarter, a $46 million loss ($40 million after deferred tax) that unfavourably impacted Diluted EPS by 27 cents;
|
•
|
in the second quarter, a $18 million gain ($16 million after deferred tax) that favourably impacted Diluted EPS by 10 cents; and
|
•
|
in the first quarter, a $181 million gain ($156 million after deferred tax) that favourably impacted Diluted EPS by $1.01.
|
•
|
in the third quarter, a $68 million gain ($42 million after current tax) related to the sale of D&H South that favourably impacted Diluted EPS by 26 cents;
|
•
|
in the third quarter, a $47 million charge ($35 million after deferred tax) related to the early redemption premium on notes that unfavourably impacted Diluted EPS by 22 cents;
|
•
|
in the second quarter, a deferred income tax expense of $23 million as a result of the change in the Alberta provincial corporate income tax rate that unfavourably impacted Diluted EPS by 14 cents; and
|
•
|
during the course of the year, a net non-cash loss of $297 million ($257 million after deferred tax) due to FX translation of the Company’s U.S. dollar-denominated debt as follows:
|
•
|
in the fourth quarter, a $115 million loss ($100 million after deferred tax) that unfavourably impacted Diluted EPS by 64 cents;
|
•
|
in the third quarter, a $128 million loss ($111 million after deferred tax) that unfavourably impacted Diluted EPS by 69 cents;
|
•
|
in the second quarter, a $10 million gain ($9 million after deferred tax) that favourably impacted Diluted EPS by 5 cents; and
|
•
|
in the first quarter, a $64 million loss ($55 million after deferred tax) that unfavourably impacted Diluted EPS by 34 cents.
|
•
|
in the fourth quarter, a net non-cash loss of $12 million ($9 million after deferred tax) due to FX translation on the Company’s U.S. dollar-denominated debt that unfavourably impacted Diluted EPS by 5 cents; and
|
•
|
in the first quarter, a recovery of $4 million ($3 million after current tax) was recorded for the Company's 2012 labour restructuring initiative due to favourable experience gains, recorded in Compensation and benefits that favourably impacted Diluted EPS by 1 cent.
|
•
|
in the fourth quarter, an asset impairment charge and accruals for future costs totalling $435 million ($257 million after deferred tax) relating to the sale of DM&E West, which closed in the second quarter of 2014 and unfavourably impacted Diluted EPS by $1.46;
|
•
|
in the fourth quarter, management transition costs related to the retirement of the Company’s CFO and the appointment of the new CFO of $5 million ($4 million after current tax) that unfavourably impacted Diluted EPS by 2 cents;
|
•
|
in the fourth quarter, a recovery of $7 million ($5 million after current tax) of the Company’s 2012 labour restructuring initiative due to favourable experience gains that favourably impacted Diluted EPS by 3 cents;
|
•
|
in the third quarter, a deferred income tax expense of $7 million as a result of the change in the province of British Columbia’s corporate income tax rate that unfavourably impacted Diluted EPS by 4 cents; and
|
•
|
in the first quarter, a recovery of U.S. $9 million (U.S. $6 million after current tax) related to settlement of certain management transition amounts, which had been subject to legal proceedings, that favourably impacted Diluted EPS by 3 cents.
|
•
|
in the fourth quarter, an asset impairment charge of $185 million ($111 million after deferred tax) with respect to the option to build into the Powder River Basin and another investment that unfavourably impacted Diluted EPS by 64 cents;
|
•
|
in the fourth quarter, an asset impairment charge of $80 million ($59 million after deferred tax) related to a certain series of locomotives that unfavourably impacted Diluted EPS by 34 cents;
|
•
|
in the fourth quarter, a labour restructuring charge of $53 million ($39 million after current tax) as part of a restructuring initiative that unfavourably impacted Diluted EPS by 22 cents;
|
•
|
in the second quarter, a charge of $42 million ($29 million after current tax) with respect to compensation and other management transition costs that unfavourably impacted Diluted EPS by 17 cents;
|
•
|
in the first and second quarters, advisory fees of $27 million ($20 million after current tax) related to shareholder matters that unfavourably impacted Diluted EPS by 12 cents; and
|
•
|
in the second quarter, a deferred income tax expense of $11 million as a result of the change in the province of Ontario's corporate income tax rate that unfavourably impacted Diluted EPS by 6 cents.
|
Net income |
For the year ended
December 31 |
||||||||||||||
(in millions)
|
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||
Adjusted income
|
$
|
1,549
|
|
$
|
1,625
|
|
$
|
1,482
|
|
$
|
1,132
|
|
$
|
753
|
|
Add significant items (pretax):
|
|
|
|
|
|
||||||||||
Legal settlement charge
|
(25
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Gain on sale of D&H South
|
—
|
|
68
|
|
—
|
|
—
|
|
—
|
|
|||||
Labour restructuring
|
—
|
|
—
|
|
4
|
|
7
|
|
(53
|
)
|
|||||
Asset impairments
|
—
|
|
—
|
|
—
|
|
(435
|
)
|
(265
|
)
|
|||||
Management transition costs
|
—
|
|
—
|
|
—
|
|
4
|
|
(42
|
)
|
|||||
Advisory fees related to shareholder matters
|
—
|
|
—
|
|
—
|
|
—
|
|
(27
|
)
|
|||||
Impact of FX translation on U.S. dollar-denominated debt
|
79
|
|
(297
|
)
|
(12
|
)
|
—
|
|
—
|
|
|||||
Early redemption premium on notes
|
—
|
|
(47
|
)
|
—
|
|
—
|
|
—
|
|
|||||
Income tax rate change
|
—
|
|
(23
|
)
|
—
|
|
(7
|
)
|
(11
|
)
|
|||||
Tax effect of adjustments
(1)
|
(4
|
)
|
26
|
|
2
|
|
174
|
|
129
|
|
|||||
Net income as reported
|
$
|
1,599
|
|
$
|
1,352
|
|
$
|
1,476
|
|
$
|
875
|
|
$
|
484
|
|
Diluted earnings per share
|
For the year ended
December 31 |
||||||||||||||
|
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||
Adjusted diluted earnings per share
|
$
|
10.29
|
|
$
|
10.10
|
|
$
|
8.50
|
|
$
|
6.42
|
|
$
|
4.34
|
|
Add significant items (pretax):
|
|
|
|
|
|
||||||||||
Legal settlement charge
|
(0.17
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Gain on sale of D&H South
|
—
|
|
0.42
|
|
—
|
|
—
|
|
—
|
|
|||||
Labour restructuring
|
—
|
|
—
|
|
0.02
|
|
0.04
|
|
(0.31
|
)
|
|||||
Asset impairments
|
—
|
|
—
|
|
—
|
|
(2.47
|
)
|
(1.53
|
)
|
|||||
Management transition costs
|
—
|
|
—
|
|
—
|
|
0.02
|
|
(0.24
|
)
|
|||||
Advisory fees related to shareholder matters
|
—
|
|
—
|
|
—
|
|
—
|
|
(0.16
|
)
|
|||||
Impact of FX translation on U.S. dollar-denominated debt
|
0.53
|
|
(1.84
|
)
|
(0.07
|
)
|
—
|
|
—
|
|
|||||
Early redemption premium on notes
|
—
|
|
(0.30
|
)
|
—
|
|
—
|
|
—
|
|
|||||
Income tax rate change
|
—
|
|
(0.14
|
)
|
—
|
|
(0.04
|
)
|
(0.06
|
)
|
|||||
Tax effect of adjustments
(1)
|
(0.02
|
)
|
0.16
|
|
0.01
|
|
0.99
|
|
0.75
|
|
|||||
Diluted earnings per share as reported
|
$
|
10.63
|
|
$
|
8.40
|
|
$
|
8.46
|
|
$
|
4.96
|
|
$
|
2.79
|
|
Operating income |
For the year ended
December 31 |
||||||||||||||
(in millions)
|
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||
Adjusted Operating income
|
$
|
2,578
|
|
$
|
2,620
|
|
$
|
2,335
|
|
$
|
1,844
|
|
$
|
1,309
|
|
Add significant items:
|
|
|
|
|
|
||||||||||
Gain on sale of D&H South
|
—
|
|
68
|
|
—
|
|
—
|
|
—
|
|
|||||
Labour restructuring
|
—
|
|
—
|
|
4
|
|
7
|
|
(53
|
)
|
|||||
Asset impairments
|
—
|
|
—
|
|
—
|
|
(435
|
)
|
(265
|
)
|
|||||
Management transition costs
|
—
|
|
—
|
|
—
|
|
4
|
|
(42
|
)
|
|||||
Operating income as reported
|
$
|
2,578
|
|
$
|
2,688
|
|
$
|
2,339
|
|
$
|
1,420
|
|
$
|
949
|
|
(in millions, except for percentages)
|
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||
Operating income for the year ended December 31
|
$
|
2,578
|
|
$
|
2,688
|
|
$
|
2,339
|
|
$
|
1,420
|
|
$
|
949
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|||||
Other income and charges
|
(45
|
)
|
335
|
|
19
|
|
17
|
|
37
|
|
|||||
Tax
(1)
|
675
|
|
728
|
|
640
|
|
312
|
|
218
|
|
|||||
|
$
|
1,948
|
|
$
|
1,625
|
|
$
|
1,680
|
|
$
|
1,091
|
|
$
|
694
|
|
Average for the twelve months of total shareholders' equity, long-term debt, long-term debt maturing within one year and short-term borrowing
|
$
|
13,532
|
|
$
|
12,561
|
|
$
|
11,653
|
|
$
|
10,842
|
|
$
|
9,564
|
|
ROIC
|
14.4
|
%
|
12.9
|
%
|
14.4
|
%
|
10.1
|
%
|
7.3
|
%
|
(in millions, except for percentages)
|
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||
Adjusted operating income for the year ended December 31
|
2,578
|
|
2,620
|
|
2,335
|
|
1,844
|
|
1,309
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
|
|||||
Other income and charges
|
(45
|
)
|
335
|
|
19
|
|
17
|
|
37
|
|
|||||
Add significant items (pretax):
|
|
|
|
|
|
|
|
|
|
|
|||||
Legal settlement charge
|
25
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Advisory fees related to shareholder matters
|
—
|
|
—
|
|
—
|
|
—
|
|
27
|
|
|||||
Impact of FX translation on U.S. dollar-denominated debt
|
(79
|
)
|
297
|
|
12
|
|
—
|
|
—
|
|
|||||
Early redemption premium on notes
|
—
|
|
47
|
|
—
|
|
—
|
|
—
|
|
|||||
Less: tax
(1)
|
673
|
|
716
|
|
642
|
|
491
|
|
344
|
|
|||||
|
$
|
1,896
|
|
$
|
1,913
|
|
$
|
1,686
|
|
$
|
1,336
|
|
$
|
955
|
|
Average for the twelve months of total shareholders' equity, long-term debt, long-term debt maturing within one year and short-term borrowing
|
$
|
13,532
|
|
$
|
12,561
|
|
$
|
11,653
|
|
$
|
10,842
|
|
$
|
9,564
|
|
Adjusted ROIC
|
14.0
|
%
|
15.2
|
%
|
14.5
|
%
|
12.3
|
%
|
10.0
|
%
|
|
For the year ended
December 31 |
||||||||||||||
(in millions)
|
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||
Cash provided by operating activities
|
$
|
2,089
|
|
$
|
2,459
|
|
$
|
2,123
|
|
$
|
1,950
|
|
$
|
1,328
|
|
Cash used in investing activities
(1)
|
(1,069
|
)
|
(1,123
|
)
|
(1,161
|
)
|
(1,186
|
)
|
(1,011
|
)
|
|||||
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents
|
(13
|
)
|
45
|
|
7
|
|
10
|
|
(1
|
)
|
|||||
Free cash
(2)
|
$
|
1,007
|
|
$
|
1,381
|
|
$
|
969
|
|
$
|
774
|
|
$
|
316
|
|
|
|
|
|
2016 vs. 2015
|
2015 vs. 2014
|
||||||||||||||||||||
(in millions)
|
Reported 2016
|
Reported 2015
|
Reported 2014
|
Variance
due to FX |
FX Adjusted 2015
|
FX Adj. %
|
Variance
due to FX |
FX Adjusted 2014
|
FX Adj. %
|
||||||||||||||||
Freight revenues
|
$
|
6,060
|
|
$
|
6,552
|
|
$
|
6,464
|
|
$
|
145
|
|
$
|
6,697
|
|
(10
|
)
|
$
|
549
|
|
$
|
7,013
|
|
(7
|
)
|
Non-freight revenues
|
172
|
|
160
|
|
156
|
|
1
|
|
161
|
|
7
|
|
4
|
|
160
|
|
—
|
|
|||||||
Total revenues
|
6,232
|
|
6,712
|
|
6,620
|
|
146
|
|
6,858
|
|
(9
|
)
|
553
|
|
7,173
|
|
(6
|
)
|
|||||||
Compensation and benefits
|
1,189
|
|
1,371
|
|
1,348
|
|
18
|
|
1,389
|
|
(14
|
)
|
62
|
|
1,410
|
|
(3
|
)
|
|||||||
Fuel
|
567
|
|
708
|
|
1,048
|
|
25
|
|
733
|
|
(23
|
)
|
143
|
|
1,191
|
|
(41
|
)
|
|||||||
Materials
|
180
|
|
184
|
|
193
|
|
2
|
|
186
|
|
(3
|
)
|
5
|
|
198
|
|
(7
|
)
|
|||||||
Equipment rents
|
173
|
|
174
|
|
155
|
|
5
|
|
179
|
|
(3
|
)
|
18
|
|
173
|
|
1
|
|
|||||||
Depreciation and amortization
|
640
|
|
595
|
|
552
|
|
5
|
|
600
|
|
7
|
|
18
|
|
570
|
|
4
|
|
|||||||
Purchased services and other
|
905
|
|
1,060
|
|
985
|
|
21
|
|
1,081
|
|
(16
|
)
|
60
|
|
1,045
|
|
1
|
|
|||||||
Gain on sale of D&H South
|
—
|
|
(68
|
)
|
—
|
|
1
|
|
(67
|
)
|
(100
|
)
|
—
|
|
—
|
|
100
|
|
|||||||
Total operating expenses
|
3,654
|
|
4,024
|
|
4,281
|
|
77
|
|
4,101
|
|
(11
|
)
|
306
|
|
4,587
|
|
(12
|
)
|
|||||||
Operating income
|
$
|
2,578
|
|
$
|
2,688
|
|
$
|
2,339
|
|
$
|
69
|
|
$
|
2,757
|
|
(6
|
)
|
$
|
247
|
|
$
|
2,586
|
|
4
|
|
(in millions, except for ratios)
|
2016
|
2015
|
2014
|
||||||
EBIT
|
$
|
2,623
|
|
$
|
2,353
|
|
$
|
2,320
|
|
Adjusted EBIT
|
2,569
|
|
2,629
|
|
2,328
|
|
|||
Net interest expense
|
471
|
|
394
|
|
282
|
|
|||
Interest coverage ratio
|
5.6
|
|
6.0
|
|
8.2
|
|
|||
Adjusted interest coverage ratio
|
5.5
|
|
6.7
|
|
8.3
|
|
|
For the year ended
December 31 |
||||||||||||||
(in millions)
|
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||
Adjusted EBITDA
|
$
|
3,153
|
|
$
|
3,281
|
|
$
|
2,864
|
|
$
|
2,464
|
|
$
|
1,957
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|||||
Net periodic pension and other benefit cost other than current service costs
|
167
|
|
70
|
|
137
|
|
82
|
|
63
|
|
|||||
Operating lease expense
|
(111
|
)
|
(127
|
)
|
(121
|
)
|
(154
|
)
|
(182
|
)
|
|||||
Depreciation and amortization
|
(640
|
)
|
(595
|
)
|
(552
|
)
|
(565
|
)
|
(539
|
)
|
|||||
Adjusted EBIT
|
2,569
|
|
2,629
|
|
2,328
|
|
1,827
|
|
1,299
|
|
|||||
Add Significant items (pretax):
|
|
|
|
|
|
||||||||||
Legal settlement charge
|
(25
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Gain on sale of D&H South
|
—
|
|
68
|
|
—
|
|
—
|
|
—
|
|
|||||
Labour restructuring
|
—
|
|
—
|
|
4
|
|
7
|
|
(53
|
)
|
|||||
Asset impairments
|
—
|
|
—
|
|
—
|
|
(435
|
)
|
(265
|
)
|
|||||
Management transition
|
—
|
|
—
|
|
—
|
|
4
|
|
(42
|
)
|
|||||
Advisory costs related to shareholder matters
|
—
|
|
—
|
|
—
|
|
—
|
|
(27
|
)
|
|||||
Impact of FX translation on U.S. dollar-denominated debt
|
79
|
|
(297
|
)
|
(12
|
)
|
—
|
|
—
|
|
|||||
Early redemption premium on notes
|
—
|
|
(47
|
)
|
—
|
|
—
|
|
—
|
|
|||||
EBIT
|
2,623
|
|
2,353
|
|
2,320
|
|
1,403
|
|
912
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
|
|||||
Net interest expense
|
471
|
|
394
|
|
282
|
|
278
|
|
276
|
|
|||||
Income tax expense
|
553
|
|
607
|
|
562
|
|
250
|
|
152
|
|
|||||
Net income as reported
|
$
|
1,599
|
|
$
|
1,352
|
|
$
|
1,476
|
|
$
|
875
|
|
$
|
484
|
|
(in millions, except for ratios)
|
2016
|
2015
|
2014
|
||||||
Adjusted net debt as at December 31
|
$
|
9,154
|
|
$
|
9,041
|
|
$
|
6,268
|
|
Adjusted EBITDA for the year ended December 31
|
3,153
|
|
3,281
|
|
2,864
|
|
|||
Adjusted net debt to Adjusted EBITDA ratio
|
2.9
|
|
2.8
|
|
2.2
|
|
(in millions)
|
2016
|
2015
|
2014
|
||||||
Adjusted net debt as at December 31
|
$
|
9,154
|
|
$
|
9,041
|
|
$
|
6,268
|
|
Add:
|
|
|
|
||||||
Pension plans deficit
|
(273
|
)
|
(295
|
)
|
(288
|
)
|
|||
Net present value of operating leases
(1)
|
(361
|
)
|
(439
|
)
|
(447
|
)
|
|||
Cash and cash equivalents
|
164
|
|
650
|
|
226
|
|
|||
Long-term debt including long-term debt maturing within one year as at December 31
|
$
|
8,684
|
|
$
|
8,957
|
|
$
|
5,759
|
|
Payments due by period (in millions)
|
Total
|
|
2017
|
|
2018 & 2019
|
|
2020 & 2021
|
|
2022 & beyond
|
|
|||||
Contractual commitments
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest on long-term debt and capital lease
|
$
|
12,526
|
|
$
|
491
|
|
$
|
889
|
|
$
|
803
|
|
$
|
10,343
|
|
Long-term debt
|
8,614
|
|
20
|
|
1,259
|
|
443
|
|
6,892
|
|
|||||
Capital leases
|
166
|
|
4
|
|
10
|
|
11
|
|
141
|
|
|||||
Operating lease
(1)
|
450
|
|
97
|
|
118
|
|
84
|
|
151
|
|
|||||
Supplier purchase
|
2,476
|
|
609
|
|
1,083
|
|
177
|
|
607
|
|
|||||
Other long-term liabilities
(2)
|
519
|
|
72
|
|
108
|
|
103
|
|
236
|
|
|||||
Total contractual commitments
|
$
|
24,751
|
|
$
|
1,293
|
|
$
|
3,467
|
|
$
|
1,621
|
|
$
|
18,370
|
|
Payments due by period (in millions)
|
Total
|
|
2017
|
|
2018 & 2019
|
|
2020 & 2021
|
|
2022 & beyond
|
|
|||||
Certain other financial commitments
|
|
|
|
|
|
||||||||||
Letters of credit
|
$
|
320
|
|
$
|
320
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Capital commitments
|
186
|
|
129
|
|
53
|
|
4
|
|
—
|
|
|||||
Total certain other financial commitments
|
$
|
506
|
|
$
|
449
|
|
$
|
53
|
|
$
|
4
|
|
$
|
—
|
|
•
|
pension benefit liabilities of
$263 million
($285 million in 2015) in "Pension and other benefit liabilities" and
$10 million
($10 million in 2015) in "Accounts payable and accrued liabilities";
|
•
|
post-retirement benefits liabilities of $383 million ($387 million in 2015) in "Pension and other benefit liabilities" and $21 million ($21 million in 2015) in "Accounts payable and accrued liabilities";
|
•
|
accruals for self-insured workers' compensation and long-term disability benefit plans, including $88 million ($86 million in 2015) in "Pension and other benefit liabilities", which are discussed in the Legal and Personal Injury Liabilities section below; and
|
•
|
pension benefit assets of
$1,070 million
($1,401 million in 2015) in "Pension assets".
|
|
Page
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
|
|
Consolidated Statements of Income
|
|
For the Year Ended December 31, 2016, 2015, and 2014
|
|
|
|
Consolidated Statements of Comprehensive Income
|
|
For the Year Ended December 31, 2016, 2015, and 2014
|
|
|
|
Consolidated Balance Sheets
|
|
At December 31, 2016 and 2015
|
|
|
|
Consolidated Statements of Cash Flows
|
|
For the Year Ended December 31, 2016, 2015, and 2014
|
|
|
|
Consolidated Statements of Changes in Shareholders' Equity
|
|
For the Year Ended December 31, 2016, 2015, and 2014
|
|
|
|
Notes to Consolidated Financial Statements
|
Year ended December 31 (in millions of Canadian dollars, except per share data)
|
2016
|
|
2015
|
|
2014
|
|
|||
Revenues
|
|
|
|
||||||
Freight
|
$
|
6,060
|
|
$
|
6,552
|
|
$
|
6,464
|
|
Non-freight
|
172
|
|
160
|
|
156
|
|
|||
Total revenues
|
6,232
|
|
6,712
|
|
6,620
|
|
|||
Operating expenses
|
|
|
|
||||||
Compensation and benefits
|
1,189
|
|
1,371
|
|
1,348
|
|
|||
Fuel
|
567
|
|
708
|
|
1,048
|
|
|||
Materials
|
180
|
|
184
|
|
193
|
|
|||
Equipment rents
|
173
|
|
174
|
|
155
|
|
|||
Depreciation and amortization
|
640
|
|
595
|
|
552
|
|
|||
Purchased services and other (Note 10)
|
905
|
|
1,060
|
|
985
|
|
|||
Gain on sale of Delaware & Hudson South (Note 10)
|
—
|
|
(68
|
)
|
—
|
|
|||
Total operating expenses
|
3,654
|
|
4,024
|
|
4,281
|
|
|||
Operating income
|
2,578
|
|
2,688
|
|
2,339
|
|
|||
Less:
|
|
|
|
||||||
Other income and charges (Note 3)
|
(45
|
)
|
335
|
|
19
|
|
|||
Net interest expense (Note 4)
|
471
|
|
394
|
|
282
|
|
|||
Income before income tax expense
|
2,152
|
|
1,959
|
|
2,038
|
|
|||
Income tax expense (Note 5)
|
553
|
|
607
|
|
562
|
|
|||
Net income
|
$
|
1,599
|
|
$
|
1,352
|
|
$
|
1,476
|
|
Earnings per share (Note 6)
|
|
|
|
||||||
Basic earnings per share
|
$
|
10.69
|
|
$
|
8.47
|
|
$
|
8.54
|
|
Diluted earnings per share
|
$
|
10.63
|
|
$
|
8.40
|
|
$
|
8.46
|
|
Weighted-average number of shares (millions) (Note 6)
|
|
|
|
||||||
Basic
|
149.6
|
|
159.7
|
|
172.8
|
|
|||
Diluted
|
150.5
|
|
161.0
|
|
174.4
|
|
Year ended December 31 (in millions of Canadian dollars)
|
2016
|
|
2015
|
|
2014
|
|
|||
Net income
|
$
|
1,599
|
|
$
|
1,352
|
|
$
|
1,476
|
|
Net gain (loss) in foreign currency translation adjustments, net of
hedging activities |
18
|
|
(86
|
)
|
(32
|
)
|
|||
Change in derivatives designated as cash flow hedges
|
(2
|
)
|
(69
|
)
|
(49
|
)
|
|||
Change in pension and post-retirement defined benefit plans
|
(434
|
)
|
1,059
|
|
(941
|
)
|
|||
Other comprehensive (loss) income before income taxes (Note 7)
|
(418
|
)
|
904
|
|
(1,022
|
)
|
|||
Income tax recovery (expense) on above items (Note 7)
|
96
|
|
(162
|
)
|
306
|
|
|||
Other comprehensive (loss) income (Note 7)
|
(322
|
)
|
742
|
|
(716
|
)
|
|||
Comprehensive income
|
$
|
1,277
|
|
$
|
2,094
|
|
$
|
760
|
|
As at December 31 (in millions of Canadian dollars, except Common Shares)
|
2016
|
|
2015
|
|
||
Assets
|
|
|
||||
Current assets
|
|
|
||||
Cash and cash equivalents
|
$
|
164
|
|
$
|
650
|
|
Accounts receivable, net (Note 9)
|
591
|
|
645
|
|
||
Materials and supplies
|
184
|
|
188
|
|
||
Other current assets
|
70
|
|
54
|
|
||
|
1,009
|
|
1,537
|
|
||
Investments (Note 11)
|
194
|
|
152
|
|
||
Properties (Note 12)
|
16,689
|
|
16,273
|
|
||
Goodwill and intangible assets (Note 13)
|
202
|
|
211
|
|
||
Pension asset (Note 20)
|
1,070
|
|
1,401
|
|
||
Other assets (Note 14)
|
57
|
|
63
|
|
||
Total assets
|
$
|
19,221
|
|
$
|
19,637
|
|
Liabilities and shareholders’ equity
|
|
|
||||
Current liabilities
|
|
|
||||
Accounts payable and accrued liabilities (Note 15)
|
$
|
1,322
|
|
$
|
1,417
|
|
Long-term debt maturing within one year (Note 16)
|
25
|
|
30
|
|
||
|
1,347
|
|
1,447
|
|
||
Pension and other benefit liabilities (Note 20)
|
734
|
|
758
|
|
||
Other long-term liabilities (Note 18)
|
284
|
|
318
|
|
||
Long-term debt (Note 16)
|
8,659
|
|
8,927
|
|
||
Deferred income taxes (Note 5)
|
3,571
|
|
3,391
|
|
||
Total liabilities
|
14,595
|
|
14,841
|
|
||
Shareholders’ equity
|
|
|
||||
Share capital (Note 19)
Authorized unlimited Common Shares without par value. Issued and outstanding are 146.3 million and 153.0 million at December 31, 2016 and 2015, respectively. |
2,002
|
|
2,058
|
|
||
Authorized unlimited number of first and second preferred shares; none outstanding.
|
|
|
||||
Additional paid-in capital
|
52
|
|
43
|
|
||
Accumulated other comprehensive loss (Note 7)
|
(1,799
|
)
|
(1,477
|
)
|
||
Retained earnings
|
4,371
|
|
4,172
|
|
||
|
4,626
|
|
4,796
|
|
||
Total liabilities and shareholders’ equity
|
$
|
19,221
|
|
$
|
19,637
|
|
Approved on behalf of the Board:
|
|
|
|
|
|
|
|
|
|
|
/s/ Andrew F. Reardon
|
|
|
/s/ Matthew H. Paull
|
|||
|
|
Andrew F. Reardon, Director,
|
|
|
Matthew H. Paull, Director,
|
|||
|
|
Chair of the Board
|
|
|
Chair of the Audit Committee
|
Year ended December 31 (in millions of Canadian dollars)
|
2016
|
|
2015
|
|
2014
|
|
|||
Operating activities
|
|
|
|
||||||
Net income
|
$
|
1,599
|
|
$
|
1,352
|
|
$
|
1,476
|
|
Reconciliation of net income to cash provided by operating activities:
|
|
|
|
||||||
Depreciation and amortization
|
640
|
|
595
|
|
552
|
|
|||
Deferred income taxes (Note 5)
|
320
|
|
234
|
|
354
|
|
|||
Pension funding in excess of expense (Note 20)
|
(138
|
)
|
(49
|
)
|
(132
|
)
|
|||
Foreign exchange (gain) loss on long-term debt (Note 3)
|
(79
|
)
|
297
|
|
11
|
|
|||
Other operating activities, net
|
(198
|
)
|
(245
|
)
|
(14
|
)
|
|||
Change in non-cash working capital balances related to operations (Note 8)
|
(55
|
)
|
275
|
|
(124
|
)
|
|||
Cash provided by operating activities
|
2,089
|
|
2,459
|
|
2,123
|
|
|||
Investing activities
|
|
|
|
||||||
Additions to properties
|
(1,182
|
)
|
(1,522
|
)
|
(1,449
|
)
|
|||
Proceeds from the sale of west end of Dakota, Minnesota and Eastern Railroad (Note 10)
|
—
|
|
—
|
|
236
|
|
|||
Proceeds from the sale of Delaware & Hudson South (Note 10)
|
—
|
|
281
|
|
—
|
|
|||
Proceeds from sale of properties and other assets (Note 10)
|
116
|
|
114
|
|
52
|
|
|||
Other
|
(3
|
)
|
4
|
|
—
|
|
|||
Cash used in investing activities
(1)
|
(1,069
|
)
|
(1,123
|
)
|
(1,161
|
)
|
|||
Financing activities
|
|
|
|
||||||
Dividends paid
|
(255
|
)
|
(226
|
)
|
(244
|
)
|
|||
Issuance of CP Common Shares (Note 19)
|
21
|
|
43
|
|
62
|
|
|||
Purchase of CP Common shares (Note 19)
|
(1,210
|
)
|
(2,787
|
)
|
(2,050
|
)
|
|||
Issuance of long-term debt, excluding commercial paper (Note 16)
|
—
|
|
3,411
|
|
—
|
|
|||
Repayment of long-term debt, excluding commercial paper (Note 16)
|
(38
|
)
|
(505
|
)
|
(183
|
)
|
|||
Net (repayment) issuance of commercial paper (Note 16)
|
(8
|
)
|
(893
|
)
|
771
|
|
|||
Settlement of foreign exchange forward on long-term debt
|
—
|
|
—
|
|
17
|
|
|||
Other
|
(3
|
)
|
—
|
|
(3
|
)
|
|||
Cash used in financing activities
|
(1,493
|
)
|
(957
|
)
|
(1,630
|
)
|
|||
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents
|
(13
|
)
|
45
|
|
7
|
|
|||
Cash position
|
|
|
|
||||||
(Decrease) increase in cash, cash equivalents, and restricted cash
(1)
|
(486
|
)
|
424
|
|
(661
|
)
|
|||
Cash, cash equivalents, and restricted cash at beginning of year
(1)
|
650
|
|
226
|
|
887
|
|
|||
Cash, cash equivalents, and restricted cash at end of year
(1)
|
$
|
164
|
|
$
|
650
|
|
$
|
226
|
|
Supplemental disclosures of cash flow information: |
|
|
|
||||||
Income taxes paid
|
$
|
322
|
|
$
|
176
|
|
$
|
226
|
|
Interest paid
|
$
|
488
|
|
$
|
336
|
|
$
|
309
|
|
(in millions of Canadian dollars except per share data)
|
Share
capital |
|
Additional
paid-in capital |
|
Accumulated
other comprehensive loss |
|
Retained
earnings |
|
Total
shareholders’ equity |
|
|||||
Balance at December 31, 2013
|
$
|
2,240
|
|
$
|
34
|
|
$
|
(1,503
|
)
|
$
|
6,326
|
|
$
|
7,097
|
|
Net income
|
—
|
|
—
|
|
—
|
|
1,476
|
|
1,476
|
|
|||||
Other comprehensive loss (Note 7)
|
—
|
|
—
|
|
(716
|
)
|
—
|
|
(716
|
)
|
|||||
Dividends declared ($1.4000 per share)
|
—
|
|
—
|
|
—
|
|
(241
|
)
|
(241
|
)
|
|||||
Effect of stock-based compensation expense
|
—
|
|
19
|
|
—
|
|
—
|
|
19
|
|
|||||
CP Common Shares repurchased (Note 19)
|
(136
|
)
|
—
|
|
—
|
|
(1,953
|
)
|
(2,089
|
)
|
|||||
Shares issued under stock option plan (Note 19)
|
81
|
|
(17
|
)
|
—
|
|
—
|
|
64
|
|
|||||
Balance at December 31, 2014
|
2,185
|
|
36
|
|
(2,219
|
)
|
5,608
|
|
5,610
|
|
|||||
Net income
|
—
|
|
—
|
|
—
|
|
1,352
|
|
1,352
|
|
|||||
Other comprehensive income (Note 7)
|
—
|
|
—
|
|
742
|
|
—
|
|
742
|
|
|||||
Dividends declared ($1.4000 per share)
|
—
|
|
—
|
|
—
|
|
(221
|
)
|
(221
|
)
|
|||||
Effect of stock-based compensation expense
|
—
|
|
17
|
|
—
|
|
—
|
|
17
|
|
|||||
CP Common Shares repurchased (Note 19)
|
(181
|
)
|
—
|
|
—
|
|
(2,567
|
)
|
(2,748
|
)
|
|||||
Shares issued under stock option plan (Note 19)
|
54
|
|
(10
|
)
|
—
|
|
—
|
|
44
|
|
|||||
Balance at December 31, 2015
|
2,058
|
|
43
|
|
(1,477
|
)
|
4,172
|
|
4,796
|
|
|||||
Net income
|
—
|
|
—
|
|
—
|
|
1,599
|
|
1,599
|
|
|||||
Other comprehensive loss (Note 7)
|
—
|
|
—
|
|
(322
|
)
|
—
|
|
(322
|
)
|
|||||
Dividends declared ($1.8500 per share)
|
—
|
|
—
|
|
—
|
|
(274
|
)
|
(274
|
)
|
|||||
Effect of stock-based compensation expense
|
—
|
|
14
|
|
—
|
|
—
|
|
14
|
|
|||||
CP Common Shares repurchased (Note 19)
|
(84
|
)
|
—
|
|
—
|
|
(1,126
|
)
|
(1,210
|
)
|
|||||
Shares issued under stock option plan (Note 19)
|
28
|
|
(5
|
)
|
—
|
|
—
|
|
23
|
|
|||||
Balance at December 31, 2016
|
$
|
2,002
|
|
$
|
52
|
|
$
|
(1,799
|
)
|
$
|
4,371
|
|
$
|
4,626
|
|
Principal subsidiary
|
Incorporated under
the laws of
|
Canadian Pacific Railway Company
|
Canada
|
Soo Line Railroad Company (“Soo Line”)
|
Minnesota
|
Delaware and Hudson Railway Company, Inc. (“D&H”)
|
Delaware
|
Dakota, Minnesota & Eastern Railroad Corporation (“DM&E”)
|
Delaware
|
Mount Stephen Properties Inc. (“MSP”)
|
Canada
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
2014
|
|
|||
Foreign exchange (gain) loss on long-term debt
|
$
|
(79
|
)
|
$
|
297
|
|
$
|
11
|
|
Other foreign exchange gains
|
(5
|
)
|
(24
|
)
|
—
|
|
|||
Early redemption premium on notes (Note 16)
|
—
|
|
47
|
|
—
|
|
|||
Legal settlement
|
25
|
|
—
|
|
—
|
|
|||
Other
|
14
|
|
15
|
|
8
|
|
|||
Total other income and charges
|
$
|
(45
|
)
|
$
|
335
|
|
$
|
19
|
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
2014
|
|
|||
Interest cost
|
$
|
497
|
|
$
|
409
|
|
$
|
301
|
|
Interest capitalized to Properties
|
(25
|
)
|
(14
|
)
|
(15
|
)
|
|||
Interest expense
|
472
|
|
395
|
|
286
|
|
|||
Interest income
|
(1
|
)
|
(1
|
)
|
(4
|
)
|
|||
Net interest expense
|
$
|
471
|
|
$
|
394
|
|
$
|
282
|
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
2014
|
|
|||
Current income tax expense
|
$
|
233
|
|
$
|
373
|
|
$
|
208
|
|
Deferred income tax expense
|
|
|
|
||||||
Origination and reversal of temporary differences
|
336
|
|
105
|
|
317
|
|
|||
Effect of tax rate increases
|
—
|
|
23
|
|
—
|
|
|||
Effect of hedge of net investment in foreign subsidiaries
|
(20
|
)
|
100
|
|
42
|
|
|||
Other
|
4
|
|
6
|
|
(5
|
)
|
|||
Total deferred income tax expense
|
320
|
|
234
|
|
354
|
|
|||
Total income taxes
|
$
|
553
|
|
$
|
607
|
|
$
|
562
|
|
Income before income tax expense
|
|
|
|
||||||
Canada
|
$
|
1,513
|
|
$
|
1,099
|
|
$
|
1,269
|
|
Foreign
|
639
|
|
860
|
|
769
|
|
|||
Total income before income tax expense
|
$
|
2,152
|
|
$
|
1,959
|
|
$
|
2,038
|
|
Income tax expense
|
|
|
|
||||||
Current
|
|
|
|
||||||
Canada
|
$
|
165
|
|
$
|
173
|
|
$
|
50
|
|
Foreign
|
68
|
|
200
|
|
158
|
|
|||
Total current income tax expense
|
233
|
|
373
|
|
208
|
|
|||
Deferred
|
|
|
|
||||||
Canada
|
207
|
|
163
|
|
292
|
|
|||
Foreign
|
113
|
|
71
|
|
62
|
|
|||
Total deferred income tax expense
|
320
|
|
234
|
|
354
|
|
|||
Total income taxes
|
$
|
553
|
|
$
|
607
|
|
$
|
562
|
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
||
Deferred income tax assets
|
|
|
||||
Amount related to tax losses carried forward
|
$
|
18
|
|
$
|
16
|
|
Liabilities carrying value in excess of tax basis
|
149
|
|
89
|
|
||
Future environmental remediation costs
|
30
|
|
33
|
|
||
Tax credits carried forward including minimum tax
|
—
|
|
—
|
|
||
Other
|
58
|
|
72
|
|
||
Total deferred income tax assets
|
255
|
|
210
|
|
||
Deferred income tax liabilities
|
|
|
||||
Properties carrying value in excess of tax basis
|
3,796
|
|
3,553
|
|
||
Other
|
30
|
|
48
|
|
||
Total deferred income tax liabilities
|
3,826
|
|
3,601
|
|
||
Total net deferred income tax liabilities
|
$
|
3,571
|
|
$
|
3,391
|
|
(in millions of Canadian dollars, except percentage)
|
2016
|
|
2015
|
|
2014
|
|
|||
Statutory federal and provincial income tax rate (Canada)
|
26.65
|
%
|
26.47
|
%
|
26.31
|
%
|
|||
Expected income tax expense at Canadian enacted statutory tax rates
|
$
|
573
|
|
$
|
519
|
|
$
|
536
|
|
Increase (decrease) in taxes resulting from:
|
|
|
|
||||||
(Gains) losses not subject to tax
|
(23
|
)
|
28
|
|
(5
|
)
|
|||
Canadian tax rate differentials
|
—
|
|
1
|
|
(1
|
)
|
|||
Foreign tax rate differentials
|
—
|
|
39
|
|
36
|
|
|||
Effect of tax rate increases
|
—
|
|
23
|
|
—
|
|
|||
Other
|
3
|
|
(3
|
)
|
(4
|
)
|
|||
Income tax expense
|
$
|
553
|
|
$
|
607
|
|
$
|
562
|
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
2014
|
|
|||
Unrecognized tax benefits at January 1
|
$
|
15
|
|
$
|
17
|
|
$
|
16
|
|
Increase in unrecognized:
|
|
|
|
||||||
Tax benefits related to the current year
|
—
|
|
4
|
|
2
|
|
|||
Dispositions:
|
|
|
|
||||||
Gross uncertain tax benefits related to prior years
|
(2
|
)
|
(6
|
)
|
(1
|
)
|
|||
Unrecognized tax benefits at December 31
|
$
|
13
|
|
$
|
15
|
|
$
|
17
|
|
(in millions of Canadian dollars, except per share data)
|
2016
|
|
2015
|
|
2014
|
|
|||
Net income
|
$
|
1,599
|
|
$
|
1,352
|
|
$
|
1,476
|
|
Weighted average basic shares outstanding (millions)
|
149.6
|
|
159.7
|
|
172.8
|
|
|||
Dilutive effect of weighted average number of stock options (millions)
|
0.9
|
|
1.3
|
|
1.6
|
|
|||
Weighted average diluted shares outstanding (millions)
|
150.5
|
|
161.0
|
|
174.4
|
|
|||
Earnings per share – basic
|
$
|
10.69
|
|
$
|
8.47
|
|
$
|
8.54
|
|
Earnings per share – diluted
|
$
|
10.63
|
|
$
|
8.40
|
|
$
|
8.46
|
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
||
Unrealized foreign exchange gain on translation of the net investment in U.S. subsidiaries
|
$
|
738
|
|
$
|
870
|
|
Unrealized foreign exchange loss on translation of the U.S. dollar-denominated long-term debt designated as a hedge of the net investment in U.S. subsidiaries
|
(611
|
)
|
(741
|
)
|
||
Deferred losses on settled hedge instruments
|
(3
|
)
|
(11
|
)
|
||
Unrealized effective losses on cash flow hedges
|
(99
|
)
|
(89
|
)
|
||
Amounts for defined benefit pension and other post-retirement plans not recognized in income (Note 20)
|
(1,822
|
)
|
(1,504
|
)
|
||
Equity accounted investments
|
(2
|
)
|
(2
|
)
|
||
Accumulated other comprehensive loss
|
$
|
(1,799
|
)
|
$
|
(1,477
|
)
|
(in millions of Canadian dollars)
|
Before
tax amount |
|
Income tax
recovery (expense) |
|
Net of tax
amount |
|
|||
For the year ended December 31, 2016
|
|
|
|
||||||
Unrealized foreign exchange gain (loss) on:
|
|
|
|
||||||
Translation of the net investment in U.S. subsidiaries
|
$
|
(132
|
)
|
$
|
—
|
|
$
|
(132
|
)
|
Translation of the U.S. dollar-denominated long-term debt designated as a hedge of the net investment in U.S. subsidiaries (Note 17)
|
150
|
|
(20
|
)
|
130
|
|
|||
Change in derivatives designated as cash flow hedges:
|
|
|
|
||||||
Realized loss on cash flow hedges recognized in income
|
10
|
|
(2
|
)
|
8
|
|
|||
Unrealized loss on cash flow hedges
|
(12
|
)
|
2
|
|
(10
|
)
|
|||
Change in pension and other benefits actuarial gains and losses
|
(422
|
)
|
113
|
|
(309
|
)
|
|||
Change in prior service pension and other benefit costs
|
(12
|
)
|
3
|
|
(9
|
)
|
|||
Other comprehensive loss
|
$
|
(418
|
)
|
$
|
96
|
|
$
|
(322
|
)
|
For the year ended December 31, 2015
|
|
|
|
||||||
Unrealized foreign exchange gain (loss) on:
|
|
|
|
||||||
Translation of the net investment in U.S. subsidiaries
|
$
|
671
|
|
$
|
—
|
|
$
|
671
|
|
Translation of the U.S. dollar-denominated long-term debt designated as a hedge of the net investment in U.S. subsidiaries (Note 17)
|
(757
|
)
|
100
|
|
(657
|
)
|
|||
Change in derivatives designated as cash flow hedges:
|
|
|
|
||||||
Realized loss on cash flow hedges recognized in income
|
7
|
|
(2
|
)
|
5
|
|
|||
Unrealized loss on cash flow hedges
|
(76
|
)
|
21
|
|
(55
|
)
|
|||
Change in pension and other benefits actuarial gains and losses
|
1,058
|
|
(281
|
)
|
777
|
|
|||
Change in prior service pension and other benefit costs
|
1
|
|
—
|
|
1
|
|
|||
Other comprehensive income
|
$
|
904
|
|
$
|
(162
|
)
|
$
|
742
|
|
For the year ended December 31, 2014
|
|
|
|
||||||
Unrealized foreign exchange gain (loss) on:
|
|
|
|
||||||
Translation of the net investment in U.S. subsidiaries
|
$
|
287
|
|
$
|
—
|
|
$
|
287
|
|
Translation of the U.S. dollar-denominated long-term debt designated as a hedge of the net investment in U.S. subsidiaries (Note 17)
|
(319
|
)
|
42
|
|
(277
|
)
|
|||
Change in derivatives designated as cash flow hedges:
|
|
|
|
||||||
Realized gain on cash flow hedges recognized in income
|
(3
|
)
|
—
|
|
(3
|
)
|
|||
Unrealized loss on cash flow hedges
|
(46
|
)
|
12
|
|
(34
|
)
|
|||
Change in pension and other benefits actuarial gains and losses
|
(873
|
)
|
234
|
|
(639
|
)
|
|||
Change in prior service pension and other benefit costs
|
(68
|
)
|
18
|
|
(50
|
)
|
|||
Other comprehensive loss
|
$
|
(1,022
|
)
|
$
|
306
|
|
$
|
(716
|
)
|
(in millions of Canadian dollars)
|
Foreign currency
net of hedging activities (1) |
Derivatives and
other (1) |
|
Pension and post-
retirement defined benefit plans (1) |
|
Total
(1)
|
|
|||||
Opening balance, 2016
|
$
|
129
|
|
$
|
(102
|
)
|
$
|
(1,504
|
)
|
$
|
(1,477
|
)
|
Other comprehensive (loss) income before reclassifications
|
(2
|
)
|
(10
|
)
|
(456
|
)
|
(468
|
)
|
||||
Amounts reclassified from accumulated other comprehensive loss
|
—
|
|
8
|
|
138
|
|
146
|
|
||||
Net current-period other comprehensive income (loss)
|
(2
|
)
|
(2
|
)
|
(318
|
)
|
(322
|
)
|
||||
Closing balance, 2016
|
$
|
127
|
|
$
|
(104
|
)
|
$
|
(1,822
|
)
|
$
|
(1,799
|
)
|
Opening balance, 2015
|
$
|
115
|
|
$
|
(52
|
)
|
$
|
(2,282
|
)
|
$
|
(2,219
|
)
|
Other comprehensive income (loss) before reclassifications
|
14
|
|
(55
|
)
|
585
|
|
544
|
|
||||
Amounts reclassified from accumulated other comprehensive loss
|
—
|
|
5
|
|
193
|
|
198
|
|
||||
Net current-period other comprehensive income (loss)
|
14
|
|
(50
|
)
|
778
|
|
742
|
|
||||
Closing balance, 2015
|
$
|
129
|
|
$
|
(102
|
)
|
$
|
(1,504
|
)
|
$
|
(1,477
|
)
|
|
2016
|
|
2015
|
|
||
Amortization of prior service costs
(1)
|
$
|
(6
|
)
|
$
|
(5
|
)
|
Recognition of net actuarial loss
(1)
|
194
|
|
269
|
|
||
Total before income tax
|
$
|
188
|
|
$
|
264
|
|
Income tax recovery
|
(50
|
)
|
(71
|
)
|
||
Net of income tax
|
$
|
138
|
|
$
|
193
|
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
2014
|
|
|||
Source (use) of cash:
|
|
|
|
||||||
Accounts receivable, net
|
$
|
44
|
|
$
|
80
|
|
$
|
(112
|
)
|
Materials and supplies
|
14
|
|
15
|
|
7
|
|
|||
Other current assets
|
(18
|
)
|
55
|
|
(75
|
)
|
|||
Accounts payable and accrued liabilities
|
(95
|
)
|
125
|
|
56
|
|
|||
Change in non-cash working capital
|
$
|
(55
|
)
|
$
|
275
|
|
$
|
(124
|
)
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
||
Freight
|
$
|
461
|
|
$
|
491
|
|
Non-freight
|
162
|
|
185
|
|
||
|
623
|
|
676
|
|
||
Allowance for doubtful accounts
|
(32
|
)
|
(31
|
)
|
||
Total accounts receivable, net
|
$
|
591
|
|
$
|
645
|
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
||
Rail investments accounted for on an equity basis
|
$
|
136
|
|
$
|
115
|
|
Other investments
|
58
|
|
37
|
|
||
Total investments
|
$
|
194
|
|
$
|
152
|
|
(in millions of Canadian dollars except percentages)
|
|
2016
|
|
2016
|
|
2015
|
|||||||||||||||||||||
|
|
Average
annual depreciation rate |
|
|
Cost
|
|
|
Accumulated
depreciation |
|
|
Net book
value |
|
|
Cost
|
|
|
Accumulated
depreciation |
|
|
Net book
value |
|
||||||
Track and roadway
|
|
2.8
|
%
|
|
$
|
16,817
|
|
|
$
|
4,573
|
|
|
$
|
12,244
|
|
|
$
|
16,303
|
|
|
$
|
4,427
|
|
|
$
|
11,876
|
|
Buildings
|
|
3.0
|
%
|
|
662
|
|
|
178
|
|
|
484
|
|
|
642
|
|
|
165
|
|
|
477
|
|
||||||
Rolling stock
|
|
2.8
|
%
|
|
4,060
|
|
|
1,524
|
|
|
2,536
|
|
|
4,041
|
|
|
1,524
|
|
|
2,517
|
|
||||||
Information systems
(1)
|
|
11.7
|
%
|
|
584
|
|
|
299
|
|
|
285
|
|
|
599
|
|
|
291
|
|
|
308
|
|
||||||
Other
|
|
5.3
|
%
|
|
1,691
|
|
|
551
|
|
|
1,140
|
|
|
1,640
|
|
|
545
|
|
|
1,095
|
|
||||||
Total
|
|
$
|
23,814
|
|
|
$
|
7,125
|
|
|
$
|
16,689
|
|
|
$
|
23,225
|
|
|
$
|
6,952
|
|
|
$
|
16,273
|
|
(in millions of Canadian dollars)
|
2016
|
2015
|
||||||||||||||||
|
Cost
|
|
Accumulated
depreciation |
|
Net book
value |
|
Cost
|
|
Accumulated
depreciation |
|
Net book
value |
|
||||||
Buildings
|
$
|
1
|
|
$
|
1
|
|
$
|
—
|
|
$
|
1
|
|
$
|
1
|
|
$
|
—
|
|
Rolling stock
|
311
|
|
105
|
|
206
|
|
311
|
|
96
|
|
215
|
|
||||||
Total assets held under capital lease
|
$
|
312
|
|
$
|
106
|
|
$
|
206
|
|
$
|
312
|
|
$
|
97
|
|
$
|
215
|
|
|
|
Intangible assets
|
|
||||||||||||
(in millions of Canadian dollars)
|
Goodwill
|
|
Cost
|
|
Accumulated
amortization |
|
Net
carrying amount |
|
Total goodwill and intangible assets
|
|
|||||
Balance at December 31, 2014
|
$
|
164
|
|
$
|
22
|
|
$
|
(10
|
)
|
$
|
12
|
|
$
|
176
|
|
Amortization
|
—
|
|
—
|
|
(1
|
)
|
(1
|
)
|
(1
|
)
|
|||||
Foreign exchange impact
|
31
|
|
—
|
|
2
|
|
2
|
|
33
|
|
|||||
Additions
|
3
|
|
—
|
|
—
|
|
—
|
|
3
|
|
|||||
Balance at December 31, 2015
|
$
|
198
|
|
$
|
22
|
|
$
|
(9
|
)
|
$
|
13
|
|
$
|
211
|
|
Amortization
|
—
|
|
—
|
|
(1
|
)
|
(1
|
)
|
(1
|
)
|
|||||
Foreign exchange impact
|
(7
|
)
|
—
|
|
(1
|
)
|
(1
|
)
|
(8
|
)
|
|||||
Balance at December 31, 2016
|
$
|
191
|
|
$
|
22
|
|
$
|
(11
|
)
|
$
|
11
|
|
$
|
202
|
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
||
Long-term materials
|
$
|
22
|
|
$
|
20
|
|
Prepaid leases
|
6
|
|
9
|
|
||
Unamortized fees on credit facility
|
7
|
|
6
|
|
||
Contracted customer incentives
|
2
|
|
5
|
|
||
Long-term receivables
|
2
|
|
2
|
|
||
Other
|
18
|
|
21
|
|
||
Total other assets
|
$
|
57
|
|
$
|
63
|
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
||
Trade payables
|
$
|
352
|
|
$
|
339
|
|
Accrued charges
|
282
|
|
293
|
|
||
Income and other taxes payable
|
146
|
|
218
|
|
||
Accrued interest
|
137
|
|
147
|
|
||
Financial derivative liability (Note 17)
|
69
|
|
60
|
|
||
Payroll-related accruals
|
73
|
|
88
|
|
||
Accrued vacation
|
65
|
|
69
|
|
||
Dividends payable
|
73
|
|
53
|
|
||
Personal injury and other claims provision
|
26
|
|
30
|
|
||
Provision for environmental remediation (Note 18)
|
9
|
|
13
|
|
||
Stock-based compensation liabilities
|
40
|
|
48
|
|
||
Other
|
50
|
|
59
|
|
||
Total accounts payable and accrued liabilities
|
$
|
1,322
|
|
$
|
1,417
|
|
(in millions of Canadian dollars)
|
Maturity
|
Currency
in which payable |
2016
|
|
2015
|
|
||||
6.500%
|
|
10-year Notes (A)
|
2018-05
|
U.S.$
|
$
|
369
|
|
$
|
380
|
|
6.250%
|
|
10-year Medium Term Notes (A)
|
2018-06
|
CDN$
|
375
|
|
374
|
|
||
7.250%
|
|
10-year Notes (A)
|
2019-05
|
U.S.$
|
469
|
|
484
|
|
||
9.450%
|
|
30-year Debentures (A)
|
2021-08
|
U.S.$
|
336
|
|
346
|
|
||
5.100%
|
|
10-year Medium Term Notes (A)
|
2022-01
|
CDN$
|
125
|
|
125
|
|
||
4.500%
|
|
10-year Notes (A)
|
2022-01
|
U.S.$
|
333
|
|
343
|
|
||
4.450%
|
|
12.5-year Notes (A)
|
2023-03
|
U.S.$
|
469
|
|
483
|
|
||
7.125%
|
|
30-year Debentures (A)
|
2031-10
|
U.S.$
|
470
|
|
484
|
|
||
5.750%
|
|
30-year Debentures (A)
|
2033-03
|
U.S.$
|
328
|
|
339
|
|
||
5.950%
|
|
30-year Notes (A)
|
2037-05
|
U.S.$
|
597
|
|
615
|
|
||
6.450%
|
|
30-year Notes (A)
|
2039-11
|
CDN$
|
400
|
|
400
|
|
||
5.750%
|
|
30-year Notes (A)
|
2042-01
|
U.S.$
|
330
|
|
340
|
|
||
2.900%
|
|
10-year Notes (A)
|
2025-02
|
U.S.$
|
940
|
|
968
|
|
||
3.700%
|
|
10.5-year Notes (A)
|
2026-02
|
U.S.$
|
335
|
|
345
|
|
||
4.800%
|
|
30-year Notes (A)
|
2045-08
|
U.S.$
|
736
|
|
759
|
|
||
4.800%
|
|
20-year Notes (A)
|
2035-09
|
U.S.$
|
401
|
|
413
|
|
||
6.125%
|
|
100-year Notes (A)
|
2115-09
|
U.S.$
|
1,208
|
|
1,246
|
|
||
5.41%
|
|
Senior Secured Notes (B)
|
2024-03
|
U.S.$
|
126
|
|
138
|
|
||
6.91%
|
|
Secured Equipment Notes (C)
|
2024-10
|
CDN$
|
133
|
|
145
|
|
||
7.49%
|
|
Equipment Trust Certificates (D)
|
2021-01
|
U.S.$
|
56
|
|
64
|
|
||
Other long-term loans (nil% – 5.50%)
|
2016 – 2025
|
U.S.$/CDN$
|
—
|
|
10
|
|
||||
Obligations under capital leases
|
|
|
|
|
||||||
|
|
(6.313% – 6.99%) (E)
|
2022 – 2026
|
U.S.$
|
163
|
|
172
|
|
||
|
|
(12.77%) (E)
|
2031-01
|
CDN$
|
3
|
|
3
|
|
||
|
|
|
8,702
|
|
8,976
|
|
||||
Perpetual 4% Consolidated Debenture Stock (F)
|
|
U.S.$
|
41
|
|
42
|
|
||||
Perpetual 4% Consolidated Debenture Stock (F)
|
|
G.B.£
|
6
|
|
7
|
|
||||
|
|
|
8,749
|
|
9,025
|
|
||||
Less: Unamortized fees on long-term debt
|
|
|
65
|
|
68
|
|
||||
|
|
|
8,684
|
|
8,957
|
|
||||
Less: Long-term debt maturing within one year
|
|
|
25
|
|
30
|
|
||||
|
|
|
|
|
$
|
8,659
|
|
$
|
8,927
|
|
(in millions of Canadian dollars)
|
Year
|
Capital leases
|
|
|
Minimum lease payments in:
|
|
|
||
|
2017
|
$
|
16
|
|
|
2018
|
16
|
|
|
|
2019
|
16
|
|
|
|
2020
|
16
|
|
|
|
2021
|
16
|
|
|
|
Thereafter
|
152
|
|
|
Total minimum lease payments
|
|
232
|
|
|
Less: Imputed interest
|
|
(66
|
)
|
|
Present value of minimum lease payments
|
|
166
|
|
|
Less: Current portion
|
|
(4
|
)
|
|
Long-term portion of capital lease obligations
|
|
$
|
162
|
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
||
Provision for environmental remediation, net of current portion
(1)
|
$
|
76
|
|
$
|
80
|
|
Stock-based compensation liabilities, net of current portion
|
72
|
|
73
|
|
||
Deferred revenue on rights-of-way licence agreements, net of current portion
|
29
|
|
33
|
|
||
Deferred retirement compensation
|
29
|
|
28
|
|
||
Deferred gains on sale leaseback transactions
|
19
|
|
22
|
|
||
Other, net of current portion
|
59
|
|
82
|
|
||
Total other long-term liabilities
|
$
|
284
|
|
$
|
318
|
|
(number of shares in millions)
|
2016
|
|
2015
|
|
2014
|
|
Share capital, January 1
|
153.0
|
|
166.1
|
|
175.4
|
|
CP Common Shares repurchased
|
(6.9
|
)
|
(13.7
|
)
|
(10.3
|
)
|
Shares issued under stock option plan
|
0.2
|
|
0.6
|
|
1.0
|
|
Share capital, December 31
|
146.3
|
|
153.0
|
|
166.1
|
|
|
2016
|
|
2015
|
|
2014
|
|
|||
Number of Common Shares repurchased
(1)
|
6,910,000
|
|
13,549,977
|
|
10,476,074
|
|
|||
Weighted-average price per share
(2)
|
$
|
175.08
|
|
$
|
202.79
|
|
$
|
199.42
|
|
Amount of repurchase (in millions)
(2)
|
$
|
1,210
|
|
$
|
2,748
|
|
$
|
2,089
|
|
|
Pensions
|
|
Other benefits
|
||||||||||||||||||||
(in millions of Canadian dollars)
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
||||||
Current service cost (benefits earned by employees in the year)
|
$
|
106
|
|
|
$
|
126
|
|
|
$
|
106
|
|
|
$
|
11
|
|
|
$
|
12
|
|
|
$
|
14
|
|
Interest cost on benefit obligation
|
467
|
|
|
463
|
|
|
477
|
|
|
21
|
|
|
21
|
|
|
23
|
|
||||||
Expected return on fund assets
|
(846
|
)
|
|
(816
|
)
|
|
(757
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Recognized net actuarial loss (gain)
|
190
|
|
|
265
|
|
|
190
|
|
|
7
|
|
|
2
|
|
|
(2
|
)
|
||||||
Amortization of prior service costs
|
(7
|
)
|
|
(6
|
)
|
|
(68
|
)
|
|
1
|
|
|
1
|
|
|
—
|
|
||||||
Net periodic benefit (recovery) cost
|
$
|
(90
|
)
|
|
$
|
32
|
|
|
$
|
(52
|
)
|
|
$
|
40
|
|
|
$
|
36
|
|
|
$
|
35
|
|
|
Pensions
|
|
Other benefits
|
||||||||||
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
|
2016
|
|
2015
|
|
||||
Change in projected benefit obligation:
|
|
|
|
|
|
||||||||
Benefit obligation at January 1
|
$
|
11,194
|
|
$
|
11,360
|
|
|
$
|
513
|
|
$
|
517
|
|
Current service cost
|
106
|
|
126
|
|
|
11
|
|
12
|
|
||||
Interest cost
|
467
|
|
463
|
|
|
21
|
|
21
|
|
||||
Employee contributions
|
40
|
|
43
|
|
|
1
|
|
1
|
|
||||
Benefits paid
|
(645
|
)
|
(608
|
)
|
|
(31
|
)
|
(34
|
)
|
||||
Foreign currency changes
|
(7
|
)
|
42
|
|
|
—
|
|
4
|
|
||||
Plan amendments and other
|
6
|
|
(6
|
)
|
|
—
|
|
—
|
|
||||
Actuarial loss (gain)
|
238
|
|
(226
|
)
|
|
(5
|
)
|
(8
|
)
|
||||
Projected benefit obligation at December 31
|
$
|
11,399
|
|
$
|
11,194
|
|
|
$
|
510
|
|
$
|
513
|
|
|
Pensions
|
|
Other benefits
|
||||||||||
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
|
2016
|
|
2015
|
|
||||
Change in fund assets:
|
|
|
|
|
|
||||||||
Fair value of fund assets at January 1
|
$
|
12,300
|
|
$
|
11,376
|
|
|
$
|
6
|
|
$
|
7
|
|
Actual return on fund assets
|
461
|
|
1,374
|
|
|
(1
|
)
|
(1
|
)
|
||||
Employer contributions
|
48
|
|
81
|
|
|
30
|
|
33
|
|
||||
Employee contributions
|
40
|
|
43
|
|
|
1
|
|
1
|
|
||||
Benefits paid
|
(645
|
)
|
(608
|
)
|
|
(31
|
)
|
(34
|
)
|
||||
Foreign currency changes
|
(8
|
)
|
34
|
|
|
—
|
|
—
|
|
||||
Fair value of fund assets at December 31
|
$
|
12,196
|
|
$
|
12,300
|
|
|
$
|
5
|
|
$
|
6
|
|
Funded status – plan surplus (deficit)
|
$
|
797
|
|
$
|
1,106
|
|
|
$
|
(505
|
)
|
$
|
(507
|
)
|
|
2016
|
|
2015
|
||||||||||
(in millions of Canadian dollars)
|
Pension
plans in surplus |
|
Pension
plans in deficit |
|
|
Pension
plans in surplus |
|
Pension
plans in deficit |
|
||||
Projected benefit obligation at December 31
|
$
|
(10,902
|
)
|
$
|
(497
|
)
|
|
$
|
(10,681
|
)
|
$
|
(513
|
)
|
Fair value of fund assets at December 31
|
11,972
|
|
224
|
|
|
12,082
|
|
218
|
|
||||
Funded Status
|
$
|
1,070
|
|
$
|
(273
|
)
|
|
$
|
1,401
|
|
$
|
(295
|
)
|
|
Pensions
|
|
Other benefits
|
||||||||||
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
|
2016
|
|
2015
|
|
||||
Pension asset
|
$
|
1,070
|
|
$
|
1,401
|
|
|
$
|
—
|
|
$
|
—
|
|
Accounts payable and accrued liabilities
|
(10
|
)
|
(10
|
)
|
|
(34
|
)
|
(34
|
)
|
||||
Pension and other benefit liabilities
|
(263
|
)
|
(285
|
)
|
|
(471
|
)
|
(473
|
)
|
||||
Total amount recognized
|
$
|
797
|
|
$
|
1,106
|
|
|
$
|
(505
|
)
|
$
|
(507
|
)
|
|
Pensions
|
|
Other benefits
|
||||||||||
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
|
2016
|
|
2015
|
|
||||
Net actuarial loss:
|
|
|
|
|
|
||||||||
Other than deferred investment gains
|
$
|
2,842
|
|
$
|
3,144
|
|
|
$
|
66
|
|
$
|
77
|
|
Deferred investment gains
|
(366
|
)
|
(1,101
|
)
|
|
—
|
|
—
|
|
||||
Prior service cost
|
(7
|
)
|
(20
|
)
|
|
3
|
|
4
|
|
||||
Deferred income tax
|
(699
|
)
|
(580
|
)
|
|
(17
|
)
|
(20
|
)
|
||||
Total (Note 7)
|
$
|
1,770
|
|
$
|
1,443
|
|
|
$
|
52
|
|
$
|
61
|
|
(percentages)
|
2016
|
|
2015
|
|
2014
|
|
Benefit obligation at December 31:
|
|
|
|
|
|
|
Discount rate
|
4.02
|
|
4.22
|
|
4.09
|
|
Projected future salary increases
|
2.75
|
|
3.00
|
|
3.00
|
|
Health care cost trend rate
|
7.00
|
(1)
|
7.00
|
(2)
|
7.00
|
(2)
|
Benefit cost for year ended December 31:
|
|
|
|
|
|
|
Discount rate
|
4.22
|
|
4.09
|
|
4.90
|
|
Expected rate of return on fund assets
|
7.75
|
|
7.75
|
|
7.75
|
|
Projected future salary increases
|
3.00
|
|
3.00
|
|
3.00
|
|
Health care cost trend rate
|
7.00
|
(2)
|
7.00
|
(2)
|
7.50
|
(3)
|
|
Current
asset allocation target |
Current
policy range |
Percentage of plan assets
at December 31 |
|
Asset allocation (percentage)
|
2016
|
2015
|
||
Cash and cash equivalents
|
0.5
|
0 – 5
|
1.1
|
1.1
|
Fixed income
|
29.5
|
20 – 40
|
21.4
|
21.0
|
Public equity
|
46.0
|
35 – 55
|
53.8
|
54.5
|
Real estate and infrastructure
|
12.0
|
4 – 20
|
7.5
|
5.8
|
Absolute return
|
12.0
|
0 – 18
|
16.2
|
17.6
|
Total
|
100.0
|
|
100.0
|
100.0
|
(in millions of Canadian dollars)
|
Quoted prices in
active markets for identical assets (Level 1) |
|
Significant other
observable inputs (Level 2) |
|
Significant
unobservable inputs (Level 3) |
|
Investments measured at NAV
(1)
|
|
Total
|
|
|||||
December 31, 2016
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
121
|
|
$
|
11
|
|
$
|
—
|
|
$
|
—
|
|
$
|
132
|
|
Fixed income
|
|
|
|
|
|
||||||||||
• Government bonds
(2)
|
—
|
|
1,357
|
|
—
|
|
—
|
|
1,357
|
|
|||||
• Corporate bonds
(2)
|
—
|
|
1,186
|
|
—
|
|
—
|
|
1,186
|
|
|||||
• Mortgages
(3)
|
—
|
|
71
|
|
—
|
|
—
|
|
71
|
|
|||||
Public equities
|
|
|
|
|
|
||||||||||
• Canada
|
1,480
|
|
57
|
|
—
|
|
—
|
|
1,537
|
|
|||||
• U.S. and international
|
4,985
|
|
36
|
|
—
|
|
—
|
|
5,021
|
|
|||||
Real estate
(4)
|
—
|
|
—
|
|
437
|
|
188
|
|
625
|
|
|||||
Derivative assets
(5)
|
—
|
|
7
|
|
—
|
|
—
|
|
7
|
|
|||||
Absolute return
(6)
|
|
|
|
|
|
||||||||||
• Funds of hedge funds
|
—
|
|
—
|
|
—
|
|
668
|
|
668
|
|
|||||
• Multi-strategy funds
|
—
|
|
—
|
|
—
|
|
502
|
|
502
|
|
|||||
• Credit funds
|
—
|
|
—
|
|
—
|
|
505
|
|
505
|
|
|||||
• Equity funds
|
—
|
|
—
|
|
—
|
|
300
|
|
300
|
|
|||||
Infrastructure
(7)
|
—
|
|
—
|
|
—
|
|
285
|
|
285
|
|
|||||
|
$
|
6,586
|
|
$
|
2,725
|
|
$
|
437
|
|
$
|
2,448
|
|
$
|
12,196
|
|
December 31, 2015
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
129
|
|
$
|
11
|
|
$
|
—
|
|
$
|
—
|
|
$
|
140
|
|
Fixed income
|
|
|
|
|
|
||||||||||
• Government bonds
(2)
|
—
|
|
1,276
|
|
—
|
|
—
|
|
1,276
|
|
|||||
• Corporate bonds
(2)
|
—
|
|
1,228
|
|
—
|
|
—
|
|
1,228
|
|
|||||
• Mortgages
(3)
|
—
|
|
81
|
|
—
|
|
—
|
|
81
|
|
|||||
Public equities
|
|
|
|
|
|
||||||||||
• Canada
|
1,449
|
|
46
|
|
—
|
|
—
|
|
1,495
|
|
|||||
• U.S. and international
|
5,169
|
|
34
|
|
—
|
|
—
|
|
5,203
|
|
|||||
Real estate
(4)
|
—
|
|
—
|
|
451
|
|
—
|
|
451
|
|
|||||
Derivative assets
(5)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Absolute return
(6)
|
|
|
|
|
|
||||||||||
• Funds of hedge funds
|
—
|
|
—
|
|
—
|
|
781
|
|
781
|
|
|||||
• Multi-strategy funds
|
—
|
|
—
|
|
—
|
|
517
|
|
517
|
|
|||||
• Credit funds
|
—
|
|
—
|
|
—
|
|
555
|
|
555
|
|
|||||
• Equity funds
|
—
|
|
—
|
|
—
|
|
311
|
|
311
|
|
|||||
Infrastructure
(7)
|
—
|
|
—
|
|
—
|
|
262
|
|
262
|
|
|||||
|
$
|
6,747
|
|
$
|
2,676
|
|
$
|
451
|
|
$
|
2,426
|
|
$
|
12,300
|
|
-
|
Funds of hedge funds invest in a portfolio of hedge funds that allocate capital across a broad array of funds and/or investment managers, with monthly redemptions upon 95 days' notice.
|
-
|
Multi-strategy funds include funds that invest in broadly diversified portfolios of equity, fixed income and derivative instruments with quarterly redemptions upon 60 days' notice.
|
-
|
Credit funds invest in an array of fixed income securities with quarterly redemptions upon 60 days' notice.
|
-
|
Equity funds invest primarily in U.S. and global equity securities. Redemptions range from quarterly upon 60 days' notice to triennially upon 45 days' notice.
|
(in millions of Canadian dollars)
|
Real Estate
|
|
|
As at January 1, 2015
|
$
|
654
|
|
Disbursements
|
(223
|
)
|
|
Net realized gains
|
64
|
|
|
Decrease in net unrealized gains
|
(44
|
)
|
|
As at December 31, 2015
|
$
|
451
|
|
Disbursements
|
(36
|
)
|
|
Net realized gains
|
24
|
|
|
Decrease in net unrealized gains
|
(2
|
)
|
|
As at December 31, 2016
|
$
|
437
|
|
(in millions of Canadian dollars)
|
Pensions
|
|
Other benefits
|
|
||
2017
|
$
|
616
|
|
$
|
33
|
|
2018
|
626
|
|
32
|
|
||
2019
|
634
|
|
32
|
|
||
2020
|
641
|
|
31
|
|
||
2021
|
649
|
|
31
|
|
||
2022 – 2026
|
3,315
|
|
147
|
|
|
Options outstanding
|
|
Nonvested options
|
||||||||
|
Number of
options |
|
Weighted
average exercise price |
|
|
Number of
options |
|
Weighted
average grant date fair value |
|
||
Outstanding, January 1, 2016
|
2,407,973
|
|
$
|
113.01
|
|
|
984,979
|
|
$
|
41.88
|
|
New options granted
|
403,740
|
|
161.06
|
|
|
403,740
|
|
39.01
|
|
||
Exercised
|
(269,491
|
)
|
74.99
|
|
|
—
|
|
—
|
|
||
Vested
|
—
|
|
—
|
|
|
(449,712
|
)
|
33.70
|
|
||
Forfeited
|
(90,340
|
)
|
186.95
|
|
|
(88,840
|
)
|
42.42
|
|
||
Expired
|
(1,800
|
)
|
60.84
|
|
|
—
|
|
—
|
|
||
Outstanding, December 31, 2016
|
2,450,082
|
|
$
|
121.95
|
|
|
850,167
|
|
$
|
44.49
|
|
Vested or expected to vest at
December 31, 2016 (1) |
2,437,475
|
|
$
|
121.62
|
|
|
N/A
|
|
N/A
|
|
|
Exercisable, December 31, 2016
|
1,599,915
|
|
$
|
93.79
|
|
|
N/A
|
|
N/A
|
|
|
Options outstanding
|
|
Options exercisable
|
|||||||||||||||
Range of exercise prices
|
Number of
options |
|
Weighted
average years to expiration |
Weighted
average exercise price |
|
Aggregate
intrinsic value (millions) |
|
|
Number of
options |
|
Weighted
average exercise price |
|
Aggregate
intrinsic value (millions) |
|
||||
$36.29 – $72.54
|
304,025
|
|
2.3
|
$
|
60.59
|
|
$
|
40
|
|
|
304,025
|
|
$
|
60.59
|
|
$
|
40
|
|
$72.55 – $86.71
|
747,445
|
|
5.4
|
73.69
|
|
88
|
|
|
747,445
|
|
73.69
|
|
88
|
|
||||
$86.72 – $161.38
|
678,416
|
|
7.0
|
127.62
|
|
44
|
|
|
347,061
|
|
111.34
|
|
28
|
|
||||
$161.39 – $236.50
|
720,196
|
|
8.5
|
192.56
|
|
(1
|
)
|
|
201,384
|
|
188.23
|
|
—
|
|
||||
Total
(1)
|
2,450,082
|
|
6.2
|
$
|
121.94
|
|
$
|
171
|
|
|
1,599,915
|
|
$
|
93.79
|
|
$
|
156
|
|
|
2016
|
|
2015
|
|
2014
|
|
|||
Expected option life (years)
(1)
|
5.25
|
|
5.25
|
|
5.98
|
|
|||
Risk-free interest rate
(2)
|
1.21
|
%
|
1.10
|
%
|
1.66
|
%
|
|||
Expected stock price volatility
(3)
|
27
|
%
|
26
|
%
|
29
|
%
|
|||
Expected annual dividends per share
(4)
|
$
|
1.40
|
|
$
|
1.40
|
|
$
|
1.40
|
|
Estimated forfeiture rate
(5)
|
2.0
|
%
|
1.2
|
%
|
1.2
|
%
|
|||
Weighted average grant date fair value
of options granted during the year |
$
|
39.01
|
|
$
|
55.28
|
|
$
|
48.88
|
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
2014
|
|
|||
Total intrinsic value
|
$
|
30
|
|
$
|
72
|
|
$
|
115
|
|
Cash received by the Company upon exercise of options
|
21
|
|
43
|
|
62
|
|
|
2016
|
|
2015
|
|
Outstanding, January 1
|
348,276
|
|
460,783
|
|
Granted
|
147,157
|
|
137,958
|
|
Units, in lieu of dividends
|
4,010
|
|
3,570
|
|
Settled
|
(83,466
|
)
|
(217,179
|
)
|
Forfeited
|
(42,384
|
)
|
(36,856
|
)
|
Outstanding, December 31
|
373,593
|
|
348,276
|
|
|
2016
|
|
2015
|
|
Outstanding, January 1
|
318,176
|
|
308,447
|
|
Granted
|
31,069
|
|
21,690
|
|
Units, in lieu of dividends
|
2,798
|
|
2,015
|
|
Settled
|
(87,996
|
)
|
(11,784
|
)
|
Forfeited
|
(30,011
|
)
|
(2,192
|
)
|
Outstanding, December 31
|
234,036
|
|
318,176
|
|
(in millions of Canadian dollars)
|
2016
|
|
2015
|
|
2014
|
|
|||
Plan
|
|
|
|
||||||
DSUs
|
$
|
17
|
|
$
|
3
|
|
$
|
17
|
|
PSUs
|
31
|
|
79
|
|
—
|
|
|||
Other
|
—
|
|
8
|
|
12
|
|
|||
Total
|
$
|
48
|
|
$
|
90
|
|
$
|
29
|
|
(in millions of Canadian dollars)
|
Operating
leases |
|
|
2017
|
$
|
97
|
|
2018
|
66
|
|
|
2019
|
52
|
|
|
2020
|
44
|
|
|
2021
|
40
|
|
|
Thereafter
|
151
|
|
|
Total minimum lease payments
|
$
|
450
|
|
•
|
residual value guarantees on operating lease commitments of
$19 million
at
December 31, 2016
;
|
•
|
guarantees to pay other parties in the event of the occurrence of specified events, including damage to equipment, in relation to assets used in the operation of the railway through operating leases, rental agreements, easements, trackage, and interline agreements; and
|
•
|
indemnifications of certain tax-related payments incurred by lessors and lenders.
|
(in millions of Canadian dollars)
|
Canada
|
|
United States
|
|
Total
|
|
|||
2016
|
|
|
|
||||||
Revenues
|
$
|
4,473
|
|
$
|
1,759
|
|
$
|
6,232
|
|
Long-term assets excluding financial instruments, mortgages receivable and deferred tax assets
|
$
|
11,000
|
|
$
|
6,121
|
|
$
|
17,121
|
|
2015
|
|
|
|
||||||
Revenues
|
$
|
4,662
|
|
$
|
2,050
|
|
$
|
6,712
|
|
Long-term assets excluding financial instruments, mortgages receivable and deferred tax assets
|
$
|
10,630
|
|
$
|
6,068
|
|
$
|
16,698
|
|
2014
|
|
|
|
||||||
Revenues
|
$
|
4,655
|
|
$
|
1,965
|
|
$
|
6,620
|
|
Long-term assets excluding financial instruments, mortgages receivable and deferred tax assets
|
$
|
10,114
|
|
$
|
4,733
|
|
$
|
14,847
|
|
For the quarter ended
|
2016
|
|
2015
|
||||||||||||||||||||||
(in millions of Canadian dollars, except per share data)
|
Dec. 31
|
|
Sep. 30
|
|
Jun. 30
|
|
Mar. 31
|
|
|
Dec. 31
|
|
Sep. 30
|
|
Jun. 30
|
|
Mar. 31
|
|
||||||||
Total revenues
|
$
|
1,637
|
|
$
|
1,554
|
|
$
|
1,450
|
|
$
|
1,591
|
|
|
$
|
1,687
|
|
$
|
1,709
|
|
$
|
1,651
|
|
$
|
1,665
|
|
Operating income
|
717
|
|
657
|
|
551
|
|
653
|
|
|
677
|
|
753
|
|
646
|
|
612
|
|
||||||||
Net income
|
384
|
|
347
|
|
328
|
|
540
|
|
|
319
|
|
323
|
|
390
|
|
320
|
|
||||||||
Basic earnings per share
(1)
|
$
|
2.63
|
|
$
|
2.35
|
|
$
|
2.16
|
|
$
|
3.53
|
|
|
$
|
2.09
|
|
$
|
2.05
|
|
$
|
2.38
|
|
$
|
1.94
|
|
Diluted earnings per share
(1)
|
2.61
|
|
2.34
|
|
2.15
|
|
3.51
|
|
|
2.08
|
|
2.04
|
|
2.36
|
|
1.92
|
|
(in millions of Canadian dollars)
|
CPRL (Parent Guarantor)
|
|
CPRC (Subsidiary Issuer)
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments and Eliminations
|
|
CPRL Consolidated
|
|
|||||
Revenues
|
|
|
|
|
|
||||||||||
Freight
|
$
|
—
|
|
$
|
4,332
|
|
$
|
1,728
|
|
$
|
—
|
|
$
|
6,060
|
|
Non-freight
|
—
|
|
134
|
|
386
|
|
(348
|
)
|
172
|
|
|||||
Total revenues
|
—
|
|
4,466
|
|
2,114
|
|
(348
|
)
|
6,232
|
|
|||||
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
|||||
Compensation and benefits
|
—
|
|
749
|
|
434
|
|
6
|
|
1,189
|
|
|||||
Fuel
|
—
|
|
458
|
|
109
|
|
—
|
|
567
|
|
|||||
Materials
|
—
|
|
130
|
|
32
|
|
18
|
|
180
|
|
|||||
Equipment rents
|
—
|
|
204
|
|
(31
|
)
|
—
|
|
173
|
|
|||||
Depreciation and amortization
|
—
|
|
422
|
|
218
|
|
—
|
|
640
|
|
|||||
Purchased services and other
|
—
|
|
673
|
|
604
|
|
(372
|
)
|
905
|
|
|||||
Total operating expenses
|
—
|
|
2,636
|
|
1,366
|
|
(348
|
)
|
3,654
|
|
|||||
Operating income
|
—
|
|
1,830
|
|
748
|
|
—
|
|
2,578
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
|
|||||
Other income and charges
|
(40
|
)
|
(34
|
)
|
29
|
|
—
|
|
(45
|
)
|
|||||
Net interest expense (income)
|
1
|
|
493
|
|
(23
|
)
|
—
|
|
471
|
|
|||||
Income before income tax expense and equity in net earnings of subsidiaries
|
39
|
|
1,371
|
|
742
|
|
—
|
|
2,152
|
|
|||||
Less: Income tax expense
|
6
|
|
337
|
|
210
|
|
—
|
|
553
|
|
|||||
Add: Equity in net earnings of subsidiaries
|
1,566
|
|
532
|
|
—
|
|
(2,098
|
)
|
—
|
|
|||||
Net income
|
$
|
1,599
|
|
$
|
1,566
|
|
$
|
532
|
|
$
|
(2,098
|
)
|
$
|
1,599
|
|
(in millions of Canadian dollars)
|
CPRL (Parent Guarantor)
|
|
CPRC (Subsidiary Issuer)
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments and Eliminations
|
|
CPRL Consolidated
|
|
|||||
Revenues
|
|
|
|
|
|
||||||||||
Freight
|
$
|
—
|
|
$
|
4,532
|
|
$
|
2,020
|
|
$
|
—
|
|
$
|
6,552
|
|
Non-freight
|
—
|
|
128
|
|
363
|
|
(331
|
)
|
160
|
|
|||||
Total revenues
|
—
|
|
4,660
|
|
2,383
|
|
(331
|
)
|
6,712
|
|
|||||
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
|||||
Compensation and benefits
|
—
|
|
943
|
|
428
|
|
—
|
|
1,371
|
|
|||||
Fuel
|
—
|
|
549
|
|
159
|
|
—
|
|
708
|
|
|||||
Materials
|
—
|
|
148
|
|
36
|
|
—
|
|
184
|
|
|||||
Equipment rents
|
—
|
|
181
|
|
(7
|
)
|
—
|
|
174
|
|
|||||
Depreciation and amortization
|
—
|
|
411
|
|
184
|
|
—
|
|
595
|
|
|||||
Purchased services and other
|
—
|
|
711
|
|
680
|
|
(331
|
)
|
1,060
|
|
|||||
Gain on sale of Delaware & Hudson South
|
—
|
|
—
|
|
(68
|
)
|
—
|
|
(68
|
)
|
|||||
Total operating expenses
|
—
|
|
2,943
|
|
1,412
|
|
(331
|
)
|
4,024
|
|
|||||
Operating income
|
—
|
|
1,717
|
|
971
|
|
—
|
|
2,688
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
|
|||||
Other income and charges
|
84
|
|
322
|
|
(71
|
)
|
—
|
|
335
|
|
|||||
Net interest (income) expense
|
(5
|
)
|
447
|
|
(48
|
)
|
—
|
|
394
|
|
|||||
(Loss) income before income tax expense and equity in net earnings of subsidiaries
|
(79
|
)
|
948
|
|
1,090
|
|
—
|
|
1,959
|
|
|||||
Less: Income tax (recovery) expense
|
(21
|
)
|
303
|
|
325
|
|
—
|
|
607
|
|
|||||
Add: Equity in net earnings of subsidiaries
|
1,410
|
|
765
|
|
—
|
|
(2,175
|
)
|
—
|
|
|||||
Net income
|
$
|
1,352
|
|
$
|
1,410
|
|
$
|
765
|
|
$
|
(2,175
|
)
|
$
|
1,352
|
|
(in millions of Canadian dollars)
|
CPRL (Parent Guarantor)
|
|
CPRC (Subsidiary Issuer)
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments and Eliminations
|
|
CPRL Consolidated
|
|
|||||
Revenues
|
|
|
|
|
|
||||||||||
Freight
|
$
|
—
|
|
$
|
4,524
|
|
$
|
1,940
|
|
$
|
—
|
|
$
|
6,464
|
|
Non-freight
|
—
|
|
130
|
|
357
|
|
(331
|
)
|
156
|
|
|||||
Total revenues
|
—
|
|
4,654
|
|
2,297
|
|
(331
|
)
|
6,620
|
|
|||||
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
|||||
Compensation and benefits
|
—
|
|
945
|
|
403
|
|
—
|
|
1,348
|
|
|||||
Fuel
|
—
|
|
779
|
|
269
|
|
—
|
|
1,048
|
|
|||||
Materials
|
—
|
|
156
|
|
37
|
|
—
|
|
193
|
|
|||||
Equipment rents
|
—
|
|
137
|
|
18
|
|
—
|
|
155
|
|
|||||
Depreciation and amortization
|
—
|
|
396
|
|
156
|
|
—
|
|
552
|
|
|||||
Purchased services and other
|
—
|
|
706
|
|
610
|
|
(331
|
)
|
985
|
|
|||||
Total operating expenses
|
—
|
|
3,119
|
|
1,493
|
|
(331
|
)
|
4,281
|
|
|||||
Operating income
|
—
|
|
1,535
|
|
804
|
|
—
|
|
2,339
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
|
|||||
Other income and charges
|
3
|
|
46
|
|
(30
|
)
|
—
|
|
19
|
|
|||||
Net interest expense
|
—
|
|
250
|
|
32
|
|
—
|
|
282
|
|
|||||
(Loss) income before income tax expense and equity in net earnings of subsidiaries
|
(3
|
)
|
1,239
|
|
802
|
|
—
|
|
2,038
|
|
|||||
Less: Income tax (recovery) expense
|
(1
|
)
|
320
|
|
243
|
|
—
|
|
562
|
|
|||||
Add: Equity in net earnings of subsidiaries
|
$
|
1,478
|
|
$
|
559
|
|
$
|
—
|
|
$
|
(2,037
|
)
|
$
|
—
|
|
Net income
|
$
|
1,476
|
|
$
|
1,478
|
|
$
|
559
|
|
$
|
(2,037
|
)
|
$
|
1,476
|
|
(in millions of Canadian dollars)
|
CPRL (Parent Guarantor)
|
|
CPRC (Subsidiary Issuer)
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments and Eliminations
|
|
CPRL Consolidated
|
|
|||||
Net income
|
$
|
1,599
|
|
$
|
1,566
|
|
$
|
532
|
|
$
|
(2,098
|
)
|
$
|
1,599
|
|
Net gain (loss) in foreign currency translation
adjustments, net of hedging activities |
—
|
|
149
|
|
(131
|
)
|
—
|
|
18
|
|
|||||
Change in derivatives designated as cash flow
hedges |
—
|
|
(2
|
)
|
—
|
|
—
|
|
(2
|
)
|
|||||
Change in pension and post-retirement defined
benefit plans |
—
|
|
(443
|
)
|
9
|
|
—
|
|
(434
|
)
|
|||||
Other comprehensive loss before
income taxes |
—
|
|
(296
|
)
|
(122
|
)
|
—
|
|
(418
|
)
|
|||||
Income tax recovery (expense) on above items
|
—
|
|
99
|
|
(3
|
)
|
—
|
|
96
|
|
|||||
Equity accounted investments
|
(322
|
)
|
(125
|
)
|
—
|
|
447
|
|
—
|
|
|||||
Other comprehensive loss
|
(322
|
)
|
(322
|
)
|
(125
|
)
|
447
|
|
(322
|
)
|
|||||
Comprehensive income
|
$
|
1,277
|
|
$
|
1,244
|
|
$
|
407
|
|
$
|
(1,651
|
)
|
$
|
1,277
|
|
(in millions of Canadian dollars)
|
CPRL (Parent Guarantor)
|
|
CPRC (Subsidiary Issuer)
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments and Eliminations
|
|
CPRL Consolidated
|
|
|||||
Net income
|
$
|
1,352
|
|
$
|
1,410
|
|
$
|
765
|
|
$
|
(2,175
|
)
|
$
|
1,352
|
|
Net (loss) gain in foreign currency translation
adjustments, net of hedging activities |
—
|
|
(757
|
)
|
671
|
|
—
|
|
(86
|
)
|
|||||
Change in derivatives designated as cash flow
hedges |
—
|
|
(69
|
)
|
—
|
|
—
|
|
(69
|
)
|
|||||
Change in pension and post-retirement defined
benefit plans |
—
|
|
1,061
|
|
(2
|
)
|
—
|
|
1,059
|
|
|||||
Other comprehensive income before
income taxes |
—
|
|
235
|
|
669
|
|
—
|
|
904
|
|
|||||
Income tax (expense) recovery on above items
|
—
|
|
(163
|
)
|
1
|
|
—
|
|
(162
|
)
|
|||||
Equity accounted investments
|
742
|
|
670
|
|
—
|
|
(1,412
|
)
|
—
|
|
|||||
Other comprehensive income
|
742
|
|
742
|
|
670
|
|
(1,412
|
)
|
742
|
|
|||||
Comprehensive income
|
$
|
2,094
|
|
$
|
2,152
|
|
$
|
1,435
|
|
$
|
(3,587
|
)
|
$
|
2,094
|
|
(in millions of Canadian dollars)
|
CPRL (Parent Guarantor)
|
|
CPRC (Subsidiary Issuer)
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments and Eliminations
|
|
CPRL Consolidated
|
|
|||||
Net income
|
$
|
1,476
|
|
$
|
1,478
|
|
$
|
559
|
|
$
|
(2,037
|
)
|
$
|
1,476
|
|
Net (loss) gain in foreign currency translation
adjustments, net of hedging activities |
—
|
|
(316
|
)
|
284
|
|
—
|
|
(32
|
)
|
|||||
Change in derivatives designated as cash flow
hedges |
—
|
|
(49
|
)
|
—
|
|
—
|
|
(49
|
)
|
|||||
Change in pension and post-retirement defined
benefit plans |
—
|
|
(908
|
)
|
(33
|
)
|
—
|
|
(941
|
)
|
|||||
Other comprehensive (loss) income before
income taxes |
—
|
|
(1,273
|
)
|
251
|
|
—
|
|
(1,022
|
)
|
|||||
Income tax recovery on above items
|
—
|
|
293
|
|
13
|
|
—
|
|
306
|
|
|||||
Equity accounted investments
|
(716
|
)
|
264
|
|
—
|
|
452
|
|
—
|
|
|||||
Other comprehensive (loss) income
|
(716
|
)
|
(716
|
)
|
264
|
|
452
|
|
(716
|
)
|
|||||
Comprehensive income
|
$
|
760
|
|
$
|
762
|
|
$
|
823
|
|
$
|
(1,585
|
)
|
$
|
760
|
|
(in millions of Canadian dollars)
|
CPRL (Parent Guarantor)
|
|
CPRC (Subsidiary Issuer)
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments and Eliminations
|
|
CPRL Consolidated
|
|
|||||
Assets
|
|
|
|
|
|
||||||||||
Current assets
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
$
|
100
|
|
$
|
64
|
|
$
|
—
|
|
$
|
164
|
|
Accounts receivable, net
|
—
|
|
435
|
|
156
|
|
—
|
|
591
|
|
|||||
Accounts receivable, intercompany
|
90
|
|
113
|
|
206
|
|
(409
|
)
|
—
|
|
|||||
Short-term advances to affiliates
|
500
|
|
692
|
|
4,035
|
|
(5,227
|
)
|
—
|
|
|||||
Materials and supplies
|
—
|
|
150
|
|
34
|
|
—
|
|
184
|
|
|||||
Other current assets
|
—
|
|
38
|
|
32
|
|
—
|
|
70
|
|
|||||
|
590
|
|
1,528
|
|
4,527
|
|
(5,636
|
)
|
1,009
|
|
|||||
Long-term advances to affiliates
|
1
|
|
—
|
|
91
|
|
(92
|
)
|
—
|
|
|||||
Investments
|
—
|
|
47
|
|
147
|
|
—
|
|
194
|
|
|||||
Investments in subsidiaries
|
8,513
|
|
10,249
|
|
—
|
|
(18,762
|
)
|
—
|
|
|||||
Properties
|
—
|
|
8,756
|
|
7,933
|
|
—
|
|
16,689
|
|
|||||
Goodwill and intangible assets
|
—
|
|
—
|
|
202
|
|
—
|
|
202
|
|
|||||
Pension asset
|
—
|
|
1,070
|
|
—
|
|
—
|
|
1,070
|
|
|||||
Other assets
|
1
|
|
48
|
|
8
|
|
—
|
|
57
|
|
|||||
Deferred income taxes
|
11
|
|
—
|
|
—
|
|
(11
|
)
|
—
|
|
|||||
Total assets
|
$
|
9,116
|
|
$
|
21,698
|
|
$
|
12,908
|
|
$
|
(24,501
|
)
|
$
|
19,221
|
|
Liabilities and shareholders’ equity
|
|
|
|
|
|
|
|
|
|
|
|||||
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|||||
Accounts payable and accrued liabilities
|
$
|
73
|
|
$
|
945
|
|
$
|
304
|
|
$
|
—
|
|
$
|
1,322
|
|
Accounts payable, intercompany
|
14
|
|
292
|
|
103
|
|
(409
|
)
|
—
|
|
|||||
Short-term advances from affiliates
|
4,403
|
|
816
|
|
8
|
|
(5,227
|
)
|
—
|
|
|||||
Long-term debt maturing within one year
|
—
|
|
25
|
|
—
|
|
—
|
|
25
|
|
|||||
|
4,490
|
|
2,078
|
|
415
|
|
(5,636
|
)
|
1,347
|
|
|||||
Pension and other benefit liabilities
|
—
|
|
658
|
|
76
|
|
—
|
|
734
|
|
|||||
Long-term advances from affiliates
|
—
|
|
92
|
|
—
|
|
(92
|
)
|
—
|
|
|||||
Other long-term liabilities
|
—
|
|
152
|
|
132
|
|
—
|
|
284
|
|
|||||
Long-term debt
|
—
|
|
8,605
|
|
54
|
|
—
|
|
8,659
|
|
|||||
Deferred income taxes
|
—
|
|
1,600
|
|
1,982
|
|
(11
|
)
|
3,571
|
|
|||||
Total liabilities
|
4,490
|
|
13,185
|
|
2,659
|
|
(5,739
|
)
|
14,595
|
|
|||||
Shareholders’ equity
|
|
|
|
|
|
|
|
|
|
|
|||||
Share capital
|
2,002
|
|
1,037
|
|
5,823
|
|
(6,860
|
)
|
2,002
|
|
|||||
Additional paid-in capital
|
52
|
|
1,638
|
|
298
|
|
(1,936
|
)
|
52
|
|
|||||
Accumulated other comprehensive (loss) income
|
(1,799
|
)
|
(1,799
|
)
|
712
|
|
1,087
|
|
(1,799
|
)
|
|||||
Retained earnings
|
4,371
|
|
7,637
|
|
3,416
|
|
(11,053
|
)
|
4,371
|
|
|||||
|
4,626
|
|
8,513
|
|
10,249
|
|
(18,762
|
)
|
4,626
|
|
|||||
Total liabilities and shareholders’ equity
|
$
|
9,116
|
|
$
|
21,698
|
|
$
|
12,908
|
|
$
|
(24,501
|
)
|
$
|
19,221
|
|
(in millions of Canadian dollars)
|
CPRL (Parent Guarantor)
|
|
CPRC (Subsidiary Issuer)
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments and Eliminations
|
|
CPRL Consolidated
|
|
|||||
Assets
|
|
|
|
|
|
||||||||||
Current assets
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
$
|
502
|
|
$
|
148
|
|
$
|
—
|
|
$
|
650
|
|
Accounts receivable, net
|
—
|
|
452
|
|
193
|
|
—
|
|
645
|
|
|||||
Accounts receivable, intercompany
|
59
|
|
105
|
|
265
|
|
(429
|
)
|
—
|
|
|||||
Short-term advances to affiliates
|
—
|
|
75
|
|
3,483
|
|
(3,558
|
)
|
—
|
|
|||||
Materials and supplies
|
—
|
|
154
|
|
34
|
|
—
|
|
188
|
|
|||||
Other current assets
|
—
|
|
37
|
|
17
|
|
—
|
|
54
|
|
|||||
|
59
|
|
1,325
|
|
4,140
|
|
(3,987
|
)
|
1,537
|
|
|||||
Long-term advances to affiliates
|
501
|
|
207
|
|
376
|
|
(1,084
|
)
|
—
|
|
|||||
Investments
|
—
|
|
22
|
|
130
|
|
—
|
|
152
|
|
|||||
Investments in subsidiaries
|
7,518
|
|
9,832
|
|
—
|
|
(17,350
|
)
|
—
|
|
|||||
Properties
|
—
|
|
8,481
|
|
7,792
|
|
—
|
|
16,273
|
|
|||||
Goodwill and intangible assets
|
—
|
|
3
|
|
208
|
|
—
|
|
211
|
|
|||||
Pension asset
|
—
|
|
1,401
|
|
—
|
|
—
|
|
1,401
|
|
|||||
Other assets
|
—
|
|
55
|
|
8
|
|
—
|
|
63
|
|
|||||
Deferred income taxes
|
25
|
|
—
|
|
—
|
|
(25
|
)
|
—
|
|
|||||
Total assets
|
$
|
8,103
|
|
$
|
21,326
|
|
$
|
12,654
|
|
$
|
(22,446
|
)
|
$
|
19,637
|
|
Liabilities and shareholders’ equity
|
|
|
|
|
|
|
|
|
|
|
|||||
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|||||
Accounts payable and accrued liabilities
|
$
|
54
|
|
$
|
1,122
|
|
$
|
241
|
|
$
|
—
|
|
$
|
1,417
|
|
Accounts payable, intercompany
|
—
|
|
325
|
|
104
|
|
(429
|
)
|
—
|
|
|||||
Short-term advances from affiliates
|
3,253
|
|
230
|
|
75
|
|
(3,558
|
)
|
—
|
|
|||||
Long-term debt maturing within one year
|
—
|
|
24
|
|
6
|
|
—
|
|
30
|
|
|||||
|
3,307
|
|
1,701
|
|
426
|
|
(3,987
|
)
|
1,447
|
|
|||||
Pension and other benefit liabilities
|
—
|
|
676
|
|
82
|
|
—
|
|
758
|
|
|||||
Long-term advances from affiliates
|
—
|
|
877
|
|
207
|
|
(1,084
|
)
|
—
|
|
|||||
Other long-term liabilities
|
—
|
|
186
|
|
132
|
|
—
|
|
318
|
|
|||||
Long-term debt
|
—
|
|
8,863
|
|
64
|
|
—
|
|
8,927
|
|
|||||
Deferred income taxes
|
—
|
|
1,505
|
|
1,911
|
|
(25
|
)
|
3,391
|
|
|||||
Total liabilities
|
3,307
|
|
13,808
|
|
2,822
|
|
(5,096
|
)
|
14,841
|
|
|||||
Shareholders’ equity
|
|
|
|
|
|
|
|
|
|
|
|||||
Share capital
|
2,058
|
|
1,037
|
|
5,465
|
|
(6,502
|
)
|
2,058
|
|
|||||
Additional paid-in capital
|
43
|
|
1,568
|
|
613
|
|
(2,181
|
)
|
43
|
|
|||||
Accumulated other comprehensive (loss) income
|
(1,477
|
)
|
(1,477
|
)
|
840
|
|
637
|
|
(1,477
|
)
|
|||||
Retained earnings
|
4,172
|
|
6,390
|
|
2,914
|
|
(9,304
|
)
|
4,172
|
|
|||||
|
4,796
|
|
7,518
|
|
9,832
|
|
(17,350
|
)
|
4,796
|
|
|||||
Total liabilities and shareholders’ equity
|
$
|
8,103
|
|
$
|
21,326
|
|
$
|
12,654
|
|
$
|
(22,446
|
)
|
$
|
19,637
|
|
(in millions of Canadian dollars)
|
CPRL (Parent Guarantor)
|
|
CPRC (Subsidiary Issuer)
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments and Eliminations
|
|
CPRL Consolidated
|
|
|||||
Cash provided by operating activities
|
$
|
255
|
|
$
|
1,424
|
|
$
|
879
|
|
$
|
(469
|
)
|
$
|
2,089
|
|
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|||||
Additions to properties
|
—
|
|
(728
|
)
|
(454
|
)
|
—
|
|
(1,182
|
)
|
|||||
Proceeds from sale of properties and other assets
|
—
|
|
102
|
|
14
|
|
—
|
|
116
|
|
|||||
Advances to affiliates
|
—
|
|
(664
|
)
|
(539
|
)
|
1,203
|
|
—
|
|
|||||
Repayment of advances to affiliates
|
—
|
|
222
|
|
—
|
|
(222
|
)
|
—
|
|
|||||
Capital contributions to affiliates
|
—
|
|
(472
|
)
|
—
|
|
472
|
|
—
|
|
|||||
Repurchase of share capital from affiliates
|
—
|
|
8
|
|
—
|
|
(8
|
)
|
—
|
|
|||||
Other
|
—
|
|
—
|
|
(3
|
)
|
—
|
|
(3
|
)
|
|||||
Cash used in investing activities
|
—
|
|
(1,532
|
)
|
(982
|
)
|
1,445
|
|
(1,069
|
)
|
|||||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|||||
Dividends paid
|
(255
|
)
|
(255
|
)
|
(214
|
)
|
469
|
|
(255
|
)
|
|||||
Issuance of share capital
|
—
|
|
—
|
|
472
|
|
(472
|
)
|
—
|
|
|||||
Return of share capital to affiliates
|
—
|
|
—
|
|
(8
|
)
|
8
|
|
—
|
|
|||||
Issuance of CP Common Shares
|
21
|
|
—
|
|
—
|
|
—
|
|
21
|
|
|||||
Purchase of CP Common Shares
|
(1,210
|
)
|
—
|
|
—
|
|
—
|
|
(1,210
|
)
|
|||||
Repayment of long-term debt, excluding commercial paper
|
—
|
|
(24
|
)
|
(14
|
)
|
—
|
|
(38
|
)
|
|||||
Net repayment of commercial paper
|
—
|
|
(8
|
)
|
—
|
|
—
|
|
(8
|
)
|
|||||
Advances from affiliates
|
1,189
|
|
—
|
|
14
|
|
(1,203
|
)
|
—
|
|
|||||
Repayment of advances from affiliates
|
—
|
|
—
|
|
(222
|
)
|
222
|
|
—
|
|
|||||
Other
|
—
|
|
(3
|
)
|
—
|
|
—
|
|
(3
|
)
|
|||||
Cash (used in) provided by financing activities
|
(255
|
)
|
(290
|
)
|
28
|
|
(976
|
)
|
(1,493
|
)
|
|||||
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents
|
—
|
|
(4
|
)
|
(9
|
)
|
—
|
|
(13
|
)
|
|||||
Cash position
|
|
|
|
|
|
|
|
|
|
|
|||||
Decrease in cash and cash equivalents
|
—
|
|
(402
|
)
|
(84
|
)
|
—
|
|
(486
|
)
|
|||||
Cash and cash equivalents at beginning of year
|
—
|
|
502
|
|
148
|
|
—
|
|
650
|
|
|||||
Cash and cash equivalents at end of year
|
$
|
—
|
|
$
|
100
|
|
$
|
64
|
|
$
|
—
|
|
$
|
164
|
|
(in millions of Canadian dollars)
|
CPRL (Parent Guarantor)
|
|
CPRC (Subsidiary Issuer)
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments and Eliminations
|
|
CPRL Consolidated
|
|
|||||
Cash provided by operating activities
|
$
|
2,283
|
|
$
|
1,650
|
|
$
|
1,074
|
|
$
|
(2,548
|
)
|
$
|
2,459
|
|
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|||||
Additions to properties
|
—
|
|
(766
|
)
|
(756
|
)
|
—
|
|
(1,522
|
)
|
|||||
Proceeds from the sale of Delaware & Hudson South
|
—
|
|
—
|
|
281
|
|
—
|
|
281
|
|
|||||
Proceeds from sale of properties and other assets
|
—
|
|
103
|
|
11
|
|
—
|
|
114
|
|
|||||
Advances to affiliates
|
(1,133
|
)
|
(311
|
)
|
(1,820
|
)
|
3,264
|
|
—
|
|
|||||
Repayment of advances to affiliates
|
—
|
|
804
|
|
1,000
|
|
(1,804
|
)
|
—
|
|
|||||
Capital contributions to affiliates
|
—
|
|
(1,655
|
)
|
—
|
|
1,655
|
|
—
|
|
|||||
Repurchase of share capital from affiliates
|
—
|
|
1,210
|
|
—
|
|
(1,210
|
)
|
—
|
|
|||||
Other
|
—
|
|
6
|
|
(2
|
)
|
—
|
|
4
|
|
|||||
Cash used in investing activities
|
(1,133
|
)
|
(609
|
)
|
(1,286
|
)
|
1,905
|
|
(1,123
|
)
|
|||||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|||||
Dividends paid
|
(226
|
)
|
(2,272
|
)
|
(276
|
)
|
2,548
|
|
(226
|
)
|
|||||
Issuance of share capital
|
—
|
|
—
|
|
1,655
|
|
(1,655
|
)
|
—
|
|
|||||
Return of share capital to affiliates
|
—
|
|
—
|
|
(1,210
|
)
|
1,210
|
|
—
|
|
|||||
Issuance of CP Common Shares
|
43
|
|
—
|
|
—
|
|
—
|
|
43
|
|
|||||
Purchase of CP Common Shares
|
(2,787
|
)
|
—
|
|
—
|
|
—
|
|
(2,787
|
)
|
|||||
Issuance of long-term debt, excluding commercial paper
|
—
|
|
3,411
|
|
—
|
|
—
|
|
3,411
|
|
|||||
Repayment of long-term debt, excluding commercial paper
|
—
|
|
(461
|
)
|
(44
|
)
|
—
|
|
(505
|
)
|
|||||
Net repayment of commercial paper
|
—
|
|
(893
|
)
|
—
|
|
—
|
|
(893
|
)
|
|||||
Advances from affiliates
|
1,820
|
|
500
|
|
944
|
|
(3,264
|
)
|
—
|
|
|||||
Repayment of advances from affiliates
|
—
|
|
(1,000
|
)
|
(804
|
)
|
1,804
|
|
—
|
|
|||||
Cash (used in) provided by financing activities
|
(1,150
|
)
|
(715
|
)
|
265
|
|
643
|
|
(957
|
)
|
|||||
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents
|
—
|
|
24
|
|
21
|
|
—
|
|
45
|
|
|||||
Cash position
|
|
|
|
|
|
|
|
|
|
|
|||||
Increase in cash and cash equivalents
|
—
|
|
350
|
|
74
|
|
—
|
|
424
|
|
|||||
Cash and cash equivalents at beginning of year
|
—
|
|
152
|
|
74
|
|
—
|
|
226
|
|
|||||
Cash and cash equivalents at end of year
|
$
|
—
|
|
$
|
502
|
|
$
|
148
|
|
$
|
—
|
|
$
|
650
|
|
(in millions of Canadian dollars)
|
CPRL (Parent Guarantor)
|
|
CPRC (Subsidiary Issuer)
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments and Eliminations
|
|
CPRL Consolidated
|
|
|||||
Cash provided by operating activities
|
$
|
183
|
|
$
|
1,684
|
|
$
|
604
|
|
$
|
(348
|
)
|
$
|
2,123
|
|
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|||||
Additions to properties
|
—
|
|
(816
|
)
|
(702
|
)
|
69
|
|
(1,449
|
)
|
|||||
Proceeds from the sale of west end of Dakota, Minnesota and Eastern Railroad
|
—
|
|
—
|
|
236
|
|
—
|
|
236
|
|
|||||
Proceeds from sale of properties and other assets
|
—
|
|
116
|
|
5
|
|
(69
|
)
|
52
|
|
|||||
Advances to affiliates
|
—
|
|
(611
|
)
|
(2,636
|
)
|
3,247
|
|
—
|
|
|||||
Repayment of advances to affiliates
|
—
|
|
2,167
|
|
1,592
|
|
(3,759
|
)
|
—
|
|
|||||
Capital contributions to affiliates
|
—
|
|
(2,927
|
)
|
—
|
|
2,927
|
|
—
|
|
|||||
Other
|
—
|
|
2
|
|
(2
|
)
|
—
|
|
—
|
|
|||||
Cash used in investing activities
(1)
|
—
|
|
(2,069
|
)
|
(1,507
|
)
|
2,415
|
|
(1,161
|
)
|
|||||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|||||
Dividends paid
|
(244
|
)
|
(182
|
)
|
(166
|
)
|
348
|
|
(244
|
)
|
|||||
Issuance of share capital
|
—
|
|
—
|
|
2,927
|
|
(2,927
|
)
|
—
|
|
|||||
Issuance of CP Common Shares
|
62
|
|
—
|
|
—
|
|
—
|
|
62
|
|
|||||
Purchase of CP Common Shares
|
(2,050
|
)
|
—
|
|
—
|
|
—
|
|
(2,050
|
)
|
|||||
Repayment of long-term debt, excluding commercial paper
|
—
|
|
(174
|
)
|
(9
|
)
|
—
|
|
(183
|
)
|
|||||
Net issuance of commercial paper
|
—
|
|
771
|
|
—
|
|
—
|
|
771
|
|
|||||
Settlement of foreign exchange forward on long-term debt
|
—
|
|
17
|
|
—
|
|
—
|
|
17
|
|
|||||
Advances from affiliates
|
2,049
|
|
1,198
|
|
—
|
|
(3,247
|
)
|
—
|
|
|||||
Repayment of advances from affiliates
|
—
|
|
(1,592
|
)
|
(2,167
|
)
|
3,759
|
|
—
|
|
|||||
Other
|
—
|
|
—
|
|
(3
|
)
|
—
|
|
(3
|
)
|
|||||
Cash (used in) provided by financing activities
|
(183
|
)
|
38
|
|
582
|
|
(2,067
|
)
|
(1,630
|
)
|
|||||
Effect of foreign currency fluctuations on U.S. dollar-denominated cash and cash equivalents
|
—
|
|
(3
|
)
|
10
|
|
—
|
|
7
|
|
|||||
Cash position
|
|
|
|
|
|
|
|
|
|
|
|||||
Decrease in cash, cash equivalents, and restricted cash
(1)
|
—
|
|
(350
|
)
|
(311
|
)
|
—
|
|
(661
|
)
|
|||||
Cash, cash equivalents, and restricted cash at beginning of year
(1)
|
—
|
|
502
|
|
385
|
|
—
|
|
887
|
|
|||||
Cash, cash equivalents, and restricted cash at end of year
(1)
|
$
|
—
|
|
$
|
152
|
|
$
|
74
|
|
$
|
—
|
|
$
|
226
|
|
(a)
|
Financial Statements
|
(b)
|
Financial Statement Schedule
|
(in millions of Canadian dollars)
|
Beginning balance at January 1
|
|
Additions charged to expenses
|
|
Payments and other reductions
|
|
Impact of FX
|
|
Ending
balance at December 31 |
|
|||||
Accruals for legal, personal injury and casualty-related claims
(1)
|
|||||||||||||||
2014
|
$
|
153
|
|
$
|
32
|
|
$
|
(38
|
)
|
$
|
3
|
|
$
|
150
|
|
2015
|
$
|
150
|
|
$
|
79
|
|
$
|
(102
|
)
|
$
|
6
|
|
$
|
133
|
|
2016
|
$
|
133
|
|
$
|
67
|
|
$
|
(71
|
)
|
$
|
1
|
|
$
|
130
|
|
Environmental liabilities
|
|||||||||||||||
2014
|
$
|
90
|
|
$
|
4
|
|
$
|
(9
|
)
|
$
|
6
|
|
$
|
91
|
|
2015
|
$
|
91
|
|
$
|
7
|
|
$
|
(17
|
)
|
$
|
12
|
|
$
|
93
|
|
2016
|
$
|
93
|
|
$
|
6
|
|
$
|
(12
|
)
|
$
|
(2
|
)
|
$
|
85
|
|
(c)
|
Exhibits
|
Exhibit
|
Description
|
3
|
Articles of incorporation and Bylaws:
|
3.1
|
Restated Certificate and Articles of Incorporation of Canadian Pacific Railway Limited (incorporated by reference to Exhibit 99.2 to Canadian Pacific Railway Limited’s Form 6-K filed with the Securities and Exchange Commission on October 22, 2015, File No. 001-01342).
|
3.2
|
By-law No. 1, as amended, of Canadian Pacific Railway Limited (incorporated by reference to Exhibit 1 to Canadian Pacific Railway Limited’s Form 6-K filed with the Securities and Exchange Commission on May 22, 2009, File No. 001-01342).
|
3.3
|
By-law No. 2 of Canadian Pacific Railway Limited (incorporated by reference to Exhibit 99.1 to Canadian Pacific Railway Limited’s Form 6-K filed with the Securities and Exchange Commission on March 13, 2015, File No. 001-01342).
|
3.4
|
General By-law, as amended, of Canadian Pacific Railway Company, a wholly owned subsidiary of Canadian Pacific Railway Limited (incorporated by reference to Exhibit 2 to Canadian Pacific Railway Limited’s Form 6-K filed with the Securities and Exchange Commission on May 22, 2009, File No. 001-01342).
|
4
|
Instruments Defining the Rights of Security Holders, Including Indentures:
|
4.1
|
Indenture dated as of May 8, 2007 between Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.1 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.2
|
First Supplemental Indenture dated as of May 8, 2007 between Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.2 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.3
|
Second Supplemental Indenture dated as of May 20, 2008 between Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.3 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.4
|
Third Supplemental Indenture dated as of May 15, 2009 between Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.4 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.5
|
Fourth Supplemental Indenture dated as of September 23, 2010 between Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.5 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.6
|
Fifth Supplemental Indenture dated as of December 1, 2011 between Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.6 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.7
|
Sixth Supplemental Indenture dated as of February 2, 2015 between Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.7 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.8
|
Seventh Supplemental Indenture dated as of August 3, 2015 between Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.8 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.9
|
Eighth Supplemental Indenture dated as of November 24, 2015 among Canadian Pacific Railway Limited, Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.9 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.10
|
Indenture dated as of October 30, 2001 between Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.10 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.11
|
First Supplemental Indenture dated as of April 23, 2004 between Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.11 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.12
|
Second Supplemental Indenture dated as of October 12, 2011 between Canadian Pacific Railway Limited and The Bank of New York Mellon (incorporated by reference to Exhibit 4.12 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.13
|
Third Supplemental Indenture dated as of October 13, 2011 between Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.13 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.14
|
Fourth Supplemental Indenture dated as of November 24, 2015 among Canadian Pacific Railway Limited, Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.14 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.15
|
Indenture dated as of July 15, 1991 between Canadian Pacific Railway Company and Harris Trust and Savings Bank (incorporated by reference to Exhibit 4.15 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.16
|
First Supplemental Indenture dated as of July 1, 1996 between Canadian Pacific Railway Company and Harris Trust and Savings Bank (incorporated by reference to Exhibit 4.16 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.17
|
Second Supplemental Indenture dated as of November 24, 2015 among Canadian Pacific Railway Limited, Canadian Pacific Railway Company and The Bank of New York Mellon (as successor in interest to Harris Trust and Savings Bank) (incorporated by reference to Exhibit 4.17 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.18
|
Indenture dated as of May 23, 2008 between Canadian Pacific Railway Company and Computershare Trust Company of Canada (incorporated by reference to Exhibit 4.18 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.19
|
First Supplemental Indenture dated as of November 24, 2015 among Canadian Pacific Railway Limited, Canadian Pacific Railway Company and Computershare Trust Company of Canada (incorporated by reference to Exhibit 4.19 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.20
|
Indenture dated as of September 11, 2015, from Canadian Pacific Railway Company to Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 99.1 to Canadian Pacific Railway Limited’s Registration Statement on Form 6-K filed with the Securities and Exchange Commission on September 14, 2015, File No. 001-01342).
|
4.21
|
First Supplemental Indenture dated as of September 11, 2015 between Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.21 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.22
|
Second Supplemental Indenture dated as of November 24, 2015 among Canadian Pacific Railway Limited, Canadian Pacific Railway Company and The Bank of New York Mellon (incorporated by reference to Exhibit 4.22 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
4.23
|
Guarantee of Canadian Pacific Railway Company’s Perpetual 4% Consolidated Debenture Stock dated as of December 18, 2015, between Canadian Pacific Railway Limited and Canadian Pacific Railway Company (incorporated by reference to Exhibit 4.23 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10
|
Material Contracts:
|
10.1*
,
**
|
Amendment dated as of January 31, 2017 to the Executive Employment Agreement dated July 23, 2016 and effective as of July 1, 2017 between Keith Creel and Canadian Pacific Railway Company.
|
10.2*
,
**
|
Offer of Employment Letter to Robert Johnson dated April 19, 2016.
|
10.3*
|
Separation Agreement between Canadian Pacific Railway and E. Hunter Harrison dated January 18, 2017 (incorporated by reference to Exhibit 10.1 Canadian Pacific Railway Limited’s Registration Statement on Form 8-K filed with the Securities and Exchange Commission on January 23, 2017, File No. 001-01342).
|
10.4*
|
Offer of Employment Letter to Nadeem Velani dated October 18, 2016 (incorporated by reference to Exhibit 10.3 Canadian Pacific Railway Limited’s Registration Statement on Form 8-K filed with the Securities and Exchange Commission on October 24, 2016, File No. 001-01342).
|
10.5*
|
Post-Retirement Consulting Agreement between the Canadian Pacific Railway Limited
and E. Hunter Harrison dated July 25, 2016 (incorporated by reference to Exhibit 10.1 to Canadian Pacific Railway Limited’s Registration Statement on Form 8-K filed with the Securities and Exchange Commission on July 26, 2016, File No. 001-01342).
|
10.6*
|
Employment Agreement, between the Canadian Pacific Railway Limited and Keith Creel effective July 1, 2017 (incorporated by reference to Exhibit 10.2 to Canadian Pacific Railway Limited’s Registration Statement on Form 8-K filed with the Securities and Exchange Commission on July 26, 2016, File No. 001-01342).
|
10.7
|
Third Amending Agreement, dated as of June 28, 2016, amending the Credit Agreement, dated September 26, 2014, between Canadian Pacific Railway Company, as Borrower, Canadian Pacific Railway Limited, as Covenantor, Royal Bank of Canada, as Administrative Agent, and the various Lenders party thereto (incorporated by reference to Exhibit 10.1 to Canadian Pacific Railway Limited’s Registration Statement on Form 8-K filed with the Securities and Exchange Commission on June 29, 2016, File No. 001-01342).
|
10.8*
|
CP 401(k) Savings Plan, as amended and restated effective October 27, 2014 (incorporated by reference to Exhibit 4.5 to Canadian Pacific Railway Limited's Registration Statement on Form S-8 filed with the Securities and Exchange Commission on December 21, 2015, File No. 333-208647).
|
10.9*
|
Stand-Alone Option Agreement dated February 4, 2013 between the Registrant and Keith Creel (incorporated by reference to Exhibit 4.2 to Canadian Pacific Railway Limited’s Registration Statement on Form S-8 filed with the Securities and Exchange Commission on May 24, 2013, File No. 333-188827).
|
10.10*
|
Performance Share Unit Plan for Eligible Employees of Canadian Pacific Railway Limited, adopted with effect from February 17, 2009, as amended February 22, 2013, April 30, 2014 and February 18, 2015 (incorporated by reference to Exhibit 10.3 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.11*
|
Canadian Pacific Railway Limited Amended and Restated Management Stock Option Incentive Plan, as amended and restated effective November 19, 2015 (incorporated by reference to Exhibit 10.4 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.12*
|
Canadian Pacific Railway Limited Employee Share Purchase Plan (U.S.) dated July 1, 2006 ("ESPP (U.S.)"), and Amendment to the ESPP (U.S.) effective January 1, 2015, and Amendment to the ESPP (U.S.) January 1, 2016 (incorporated by reference to Exhibit 10.5 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.13*
|
Stand-Alone Option Agreement dated June 26, 2012 between the Registrant and E. Hunter Harrison (incorporated by reference to Exhibit 4.2 to Canadian Pacific Railway Limited’s Registration Statement on Form S-8 filed with the Securities and Exchange Commission on September 14, 2012, File No. 333-183891).
|
10.14*
|
Directors' Stock Option Plan, effective October 1, 2001 (incorporated by reference to Exhibit 10.7 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.15*
|
Directors' Deferred Share Unit Plan, as amended effective July 1, 2013 (incorporated by reference to Exhibit 10.8 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.16*
|
Senior Executives' Deferred Share Unit Plan, effective as of January 1, 2001, as amended September 6, 2012 (incorporated by reference to Exhibit 10.9 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.17*
|
Canadian Pacific Railway Limited Employee Share Purchase Plan (Canada) dated July 1, 2006 ("ESPP (Canada)"), and Amendment to the ESPP (Canada) effective January 1, 2013, and Amendment to the ESPP (Canada) effective November 5, 2013, and Amendment to the ESPP (Canada) effective July 17, 2014 (incorporated by reference to Exhibit 10.10 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.18*
|
Canadian Pacific U.S. Salaried Retirement Income Plan, as restated effective January 1, 2015 (incorporated by reference to Exhibit 10.11 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.19*
|
Canadian Pacific U.S. Supplemental Executive Retirement Plan, effective January 1, 2013 ("CPUSERP"), and First Amendment to the CPUSERP effective November 14, 2013, and Second Amendment to the CPUSERP effective January 1, 2014 (incorporated by reference to Exhibit 10.12 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.20*
|
Restricted Share Unit Plan for Eligible Employees of Canadian Pacific Railway Limited, effective August 2, 2011, as amended February 21, 2013 (incorporated by reference to Exhibit 10.13 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.21*
|
Short Term Incentive Plan for Non-Unionized Employees (Canada) and US Salaried Employees, effective January 1, 2014 (incorporated by reference to Exhibit 10.14 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.22*
|
Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.15 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.23*
|
Amendment Number 1, effective July 1, 2010, to the Defined Contribution Provisions (Appendix B) of the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.16 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.24*
|
Amendment Number 2, effective April 1, 2011, to the Defined Contribution Provisions (Appendix B) of the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.17 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.25*
|
Amendment Number 3, effective January 1, 2013, to the Defined Contribution Provisions (Appendix B) of the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.18 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.26*
|
Amendment Number 1 to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009, approved by the Board of Directors on December 16, 2009 (incorporated by reference to Exhibit 10.19 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.27*
|
Amendment Number 2, effective January 1, 2010, to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.20 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.28*
|
Amendment Number 3, effective January 1, 2010, to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.21 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.29*
|
Amendment Number 4, effective January 1, 2011, to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.22 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.30*
|
Amendment Number 5, effective January 1, 2011, to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.23 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.31*
|
Amendment Number 6, effective October 1, 2012, to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.24 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.32*
|
Amendment Number 7, effective January 1, 2013, to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.25 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.33*
|
Amendment Number 8, effective January 1, 2013, to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.26 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.34*
|
Amendment Number 9, effective January 1, 2013, to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.27 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.35*
|
Amendment Number 10, effective January 1, 2013, to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.28 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.36*
|
Amendment Number 11, effective January 1, 2013, to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.29 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.37*
|
Amendment Number 12, effective January 1, 2015, to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.30 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.38*
|
Amendment Number 13, effective January 1, 2015, to the Canadian Pacific Railway Company Pension Plan (Pension Plan Rules), consolidated as at January 1, 2009 (incorporated by reference to Exhibit 10.31 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.39*
|
Canadian Pacific Railway Company Secondary Pension Plan (Pension Plan Rules), effective June 1, 2013 (incorporated by reference to Exhibit 10.32 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.40*
|
Amendment Number 1, effective June 1, 2013, to the Canadian Pacific Railway Company Secondary Pension Plan (Pension Plan Rules), effective June 1, 2013 (incorporated by reference to Exhibit 10.33 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.41*
|
Amendment Number 2, effective January 1, 2015, to the Canadian Pacific Railway Company Secondary Pension Plan (Pension Plan Rules) effective January 1, 2015 (incorporated by reference to Exhibit 10.34 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.42*
|
Canadian Pacific Supplemental Executive Retirement Plan, effective January 1, 2011 (incorporated by reference to Exhibit 10.35 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.43*
|
Executive Employment Agreement between Canadian Pacific Railway Company and Hunter Harrison, effective as of June 28, 2012 (incorporated by reference to Exhibit 10.36 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.44*
|
Amendment dated as of May 5, 2014, to the Executive Employment Agreement between Canadian Pacific Railway Company and Hunter Harrison, effective as of June 28, 2012 (incorporated by reference to Exhibit 10.37 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.45*
|
Executive Employment Agreement between Canadian Pacific Railway Company, Soo Line Railroad Company and Keith Creel, effective as of February 5, 2013 (incorporated by reference to Exhibit 10.38 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.46*
|
Amendment dated August 10, 2015, to the Executive Employment Agreement between Canadian Pacific Railway Company, Soo Line Railroad Company and Keith Creel, effective as of February 5, 2013 (incorporated by reference to Exhibit 10.39 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.47*
|
Offer of Employment Letter to Mark Erceg dated April 30, 2015 (incorporated by reference to Exhibit 10.40 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.48*
|
Change in Control Agreement between Canadian Pacific Railway Company and Mark Erceg made as of May 18, 2015 (incorporated by reference to Exhibit 10.41 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.49*
|
Offer of Employment Letter to Mark Wallace dated July 16, 2012 (incorporated by reference to Exhibit 10.42 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.50*
|
Change in Control Agreement between Canadian Pacific Railway Company and Mark Wallace made as of May 1, 2014 (incorporated by reference to Exhibit 10.43 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.51*
|
Offer of Employment Letter to Laird Pitz dated March 7, 2014 (incorporated by reference to Exhibit 10.44 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.52
|
Credit Agreement dated as of September 26, 2014 among Canadian Pacific Railway Company and CPR Securities Limited, as borrowers, Canadian Pacific Railway Limited, as covenantor, the Financial Institutions that are signatories to the Credit Agreement, as Lenders, the Royal Bank of Canada, as Administrative Agent, RBC Capital Markets, J.P. Morgan Securities LLC, TD Securities, Morgan Stanley MUFG Loan Partners, LLC and Citibank, N.A., Canadian Branch, as Co-Lead Arrangers, RBC Capital Markets and J.P. Morgan Securities LLC, as Joint Bookrunners, J.P. Morgan Chase Bank, N.A., as Syndication Agent, The Toronto-Dominion Bank, Morgan Stanley MUFG Loan Partners, LLC and Citibank, N.A., Canadian Branch, as Co-Documentation Agents (incorporated by reference to Exhibit 10.45 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.53
|
First Amending Agreement dated as of June 15, 2015, to the Credit Agreement dated September 26, 2014, among Canadian Pacific Railway Company and CPR Securities Limited, as borrowers, Canadian Pacific Railway Limited, as covenantor, the signatories to this First Amending Agreement to the Credit Agreement, as Lenders, the Royal Bank of Canada, as Administrative Agent (incorporated by reference to Exhibit 10.46 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
10.54
|
Second Amending Agreement dated as of September 17, 2015, to the Credit Agreement dated September 26, 2014, among Canadian Pacific Railway Company and CPR Securities Limited, as borrowers, Canadian Pacific Railway Limited, as covenantor, the signatories to the Second Amending Agreement to this Credit Agreement, as Lenders, the Royal Bank of Canada, as Administrative Agent (incorporated by reference to Exhibit 10.47 to Canadian Pacific Railway Limited’s Form 10-K filed with the Securities and Exchange Commission on February 29, 2016, File No. 001-01342).
|
12.1**
|
Ratio of earnings to fixed charges
|
21.1**
|
Subsidiaries of the registrant
|
23.1**
|
Consent of Independent Registered Public Accounting Firm
|
24.1**
|
Power of attorney (included on the signature pages of this Form 10-K)
|
31.1**
|
CEO Rule 13a-14(a) Certifications
|
31.2**
|
CFO Rule 13a-14(a) Certifications
|
32.1**
|
CEO Section 1350 Certifications
|
32.2**
|
CFO Section 1350 Certifications
|
99.1**
|
Annual CEO Certification pursuant to NYSE Rule 303A.12(a)
|
101.INS**
|
XBRL Instance Document
|
101.SCH**
|
XBRL Taxonomy Extension Schema Document
|
101.CAL**
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.LAB**
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.DEF**
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.PRE**
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
The following financial information from Canadian Pacific Railway Limited’s Annual Report on Form 10-K for the year ended December 31, 2016, formatted in Extensible Business Reporting Language (XBRL) includes: (i) the Consolidated Statements of Income of each of the years ended December 31, 2016, 2015, and 2014; (ii) the Consolidated Statements of Comprehensive Income for each of the years ended December 31, 2016, 2015, and 2014; (iii) the Consolidated Balance Sheets at December 31, 2016 and 2015; (iv) the Consolidated Statements of Cash Flows for the years ended December 31, 2016, 2015, and 2014; (v) the Consolidated Statements of Changes in Shareholders’ Equity for each of the three years ended December 31, 2016, 2015, and 2014; and (vi) the Notes to Consolidated Financial Statements.
|
CANADIAN PACIFIC RAILWAY LIMITED
|
|
(Registrant)
|
|
By:
|
/s/ KEITH CREEL
|
|
Keith Creel
|
|
Chief Executive Officer
|
Signature
|
Title
|
/s/ KEITH CREEL
|
Chief Executive Officer and Director
|
Keith Creel
|
(Principal Executive Officer)
|
|
|
/s/ NADEEM VELANI
|
Vice-President and Chief Financial Officer
|
Nadeem Velani
|
(Principal Financial Officer)
|
|
|
/s/ ANDREW F. REARDON
|
Chairman of the Board of Directors
|
Andrew F. Reardon
|
|
|
|
/s/ JOHN R. BAIRD
|
Director
|
John R. Baird
|
|
|
|
/s/ ISABELLE COURVILLE
|
Director
|
Isabelle Courville
|
|
|
|
/s/ GILLIAN H. DENHAM
|
Director
|
Gillian H. Denham
|
|
|
|
/s/ WILLIAM R. FATT
|
Director
|
William R. Fatt
|
|
|
|
/s/ REBECCA MACDONALD
|
Director
|
Rebecca MacDonald
|
|
|
|
/s/ MATTHEW H. PAULL
|
Director
|
Matthew H. Paull
|
|
|
|
/s/ JANE L. PEVERETT
|
Director
|
Jane L. Peverett
|
|
|
|
/s/ GORDON T. TRAFTON II
|
Director
|
Gordon T. Trafton II
|
|
1.
|
Capitalized Terms
. Except as defined herein, capitalized terms used herein shall have the meanings ascribed to such terms in the Employment Agreement.
|
2.
|
Effective Date
. The first recital on page 1 of the Employment Agreement is hereby amended to delete the date of "July 1, 2017" and replace it with "January 31, 2017".
|
3.
|
Performance Options
. Section 2(b) of the Employment Agreement is hereby amended as follows:
|
a.
|
The phrase "Effective Date" in the first sentence of paragraph 2(b)(i) of the Employment Agreement is deleted and replaced with "February 1, 2017".
|
b.
|
The date of "July 1, 2022" in the last sentence of paragraph 2(b)(i) of the Employment Agreement is deleted and replaced with "February 1, 2022".
|
c.
|
Section 2(b)(ii) of the Employment Agreement is deleted in its entirety.
|
4.
|
Long Term Incentive Plan
. Section 2(d) of the Employment Agreement is hereby amended to delete "2018" and replace it with "2017".
|
5.
|
Term, Termination and Effects of Agreement
. All references to the date of "July 1, 2022" in the Employment Agreement, including the references to the date of "July 1, 2022" in Sections 9 (b)(i),(ii),(iii),(iv) and (v) of the Employment Agreement are deleted and replaced with "February 1, 2022".
|
6.
|
Continuing Effect of Employment Agreement
. Except as expressly modified hereby, the provisions of the Employment Agreement are and shall remain in full force and effect.
|
7.
|
Governing Law
. This amendment shall in all respects be subject to, and governed by, the laws of the Province of Alberta without giving effect to its conflict of laws principles.
|
8.
|
Counterparts
. This Amendment may be executed in two or more counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument.
|
|
Keith Creel
President &
Chief Operating Officer
|
|
7550 Ogden Dale Road SE
Calgary Alberta
Canada T2C 4X9
|
|
T
403 319 7600
F
403 205 9000
keith_creel@cpr.ca
|
|
December 31 (in millions, except for ratios)
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
|||||
Fixed charges:
|
|
|
|
|
|
||||||||||
Net interest expense including amortization of debt discount
|
$
|
471
|
|
$
|
394
|
|
$
|
282
|
|
$
|
278
|
|
$
|
276
|
|
Interest capitalized to properties
|
25
|
|
14
|
|
15
|
|
13
|
|
15
|
|
|||||
Interest income
|
1
|
|
1
|
|
4
|
|
5
|
|
3
|
|
|||||
Portion of rentals representing an interest factor
|
11
|
|
11
|
|
9
|
|
11
|
|
13
|
|
|||||
Total fixed charges
|
$
|
508
|
|
$
|
420
|
|
$
|
310
|
|
$
|
307
|
|
$
|
307
|
|
Earnings available for fixed charges:
|
|
|
|
|
|
||||||||||
Income before income tax expense
|
$
|
2,152
|
|
$
|
1,959
|
|
$
|
2,038
|
|
$
|
1,125
|
|
$
|
636
|
|
Amortization of interest capitalized to properties
|
15
|
|
15
|
|
14
|
|
14
|
|
14
|
|
|||||
Fixed charges
|
508
|
|
420
|
|
310
|
|
307
|
|
307
|
|
|||||
Equity earnings net of distributions
|
(18
|
)
|
(9
|
)
|
(7
|
)
|
2
|
|
(2
|
)
|
|||||
Interest capitalized to properties
|
(25
|
)
|
(14
|
)
|
(15
|
)
|
(13
|
)
|
(15
|
)
|
|||||
Earnings available for fixed charges
|
$
|
2,632
|
|
$
|
2,371
|
|
$
|
2,340
|
|
$
|
1,435
|
|
$
|
940
|
|
Ratio of earnings to fixed charges
|
5.2
|
|
5.6
|
|
7.5
|
|
4.7
|
|
3.1
|
|
Significant subsidiary
|
Incorporated under the laws of
|
Canadian Pacific Railway Company
|
Canada
|
6061338 Canada Inc.
|
Canada
|
Mount Stephen Properties Inc.
|
Canada
|
3939804 Canada Inc.
|
Canada
|
CPR Finance ULC
|
Canada
|
CPR Finance II Ltd.
|
Canada
|
CPR Finance III Ltd.
|
Canada
|
6211241 Canada Inc.
|
Canada
|
CP Finance Luxembourg S.à.r.l.
|
Luxembourg
|
CP (US) Holding Corporation
|
Delaware
|
Soo Line Corporation
|
Minnesota
|
Soo Line Railroad Company
|
Minnesota
|
Soo Line Holding Company
|
Delaware
|
Dakota, Minnesota & Eastern Railroad Corporation
|
Delaware
|
1.
|
I have reviewed this Annual Report on Form 10-K of Canadian Pacific Railway Limited;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
|
|
Date:
February 16, 2017
|
|
/s/ KEITH CREEL
|
|
|
Keith Creel
|
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K of Canadian Pacific Railway Limited;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
|
|
Date:
February 16, 2017
|
|
/s/ NADEEM VELANI
|
|
|
Nadeem Velani
|
|
|
Vice-President and Chief Financial Officer
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
|
|
Date:
February 16, 2017
|
|
|
|
/s/ KEITH CREEL
|
|
|
|
|
Keith Creel
|
|
|
|
|
Chief Executive Officer
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
|
|
Date:
February 16, 2017
|
|
|
|
/s/ NADEEM VELANI
|
|
|
|
|
Nadeem Velani
|
|
|
|
|
Vice-President and Chief Financial Officer
|